question.jpgIn Trusts and Estates

Can a beneficiary transfer his or her interest in a trust?

A beneficiary to a trust owns the equitable title in the trust property. This is a property right that can be sold, transferred or assigned just like any other property interest. For example, the beneficiary can sell his or her rights outright to a friend or family member. However, the trust itself may limit the beneficiary’s ability to do so, e.g., the trust may identify a specific individual as a beneficiary but note that the equitable title reverts to someone else if that individual attempts to transfer his or her rights. In fact, many trusts go a step further and include an explicit spendthrift restriction.