How We Serve Families
For nearly 40 years, Baird Trust has helped high-net-worth individuals and institutions ensure their legacies across generations and through changing market cycles. With more than $17 billion in client assets, Baird Trust is one of the largest state-chartered trust companies in Kentucky. From our headquarters in Louisville and branch offices in Indiana, Ohio, Tennessee, and South Carolina, we offer asset management, estate planning, wealth transfer, tax planning and trust services to clients throughout the United States.
A Trustee is responsible for managing and administering the finances and operations of a Trust per the instructions given in the trust document. Often, the person who creates the Trust is the Trustee until they can no longer fill the role due to incapacity or death. At that point, a Successor Trustee takes over. The responsibilities can include:
- Safeguarding trust assets
- Recording expenses and income
- Distributing funds to beneficiaries
- Filing income tax returns on any income the Trust earns
- Keeping records of other transactions that occur
- Interpreting the terms of the controlling documents
Individuals include trusts in their estate plans for a variety of reasons: to take advantage of the privacy and tax savings trusts can afford, to help protect family assets, or simply to free their families from the complexity and expense that probate can entail. Whatever the reason for including a trust in an estate plan, the trust creator, also known as the “settlor,” must address the critical question of whom to name as trustee if he or she cannot serve in that capacity. Some settlors are comfortable naming an individual as his or her successor trustee, but others choose a corporate trustee. The best choice for your trust will depend on a number of factors.
While an individual trustee may be more familiar with family dynamics, including insight into the intent behind the trust, relying on a corporate trustee has significant advantages:
- Professional trust administration and investment experience.
- Objective decision making based on the terms of the trust and applicable trust law.
- Service that won’t be interrupted by disability or death as can be the case with individual trustees.
- Staff experienced in helping beneficiaries understand how their trusts affect them.
- Impartiality when dealing with trust beneficiaries.
Agent for Trustee
As agent for a trustee, Baird Trust can provide expertise and support that an individual trustee often lacks. These duties include performing fiduciary accounting (principal and income segregation), maintaining records, making distributions as directed by the trustee, completing tax reporting, and holding custody of special assets. It’s important to note that having Baird Trust act as agent does not eliminate an individual trustee’s fiduciary responsibility. Additionally, the appointment of an agent does not require beneficiary approval.
Baird Trust can serve as co-trustee alongside a family member or other individual trustee. In a co-trustee arrangement, both parties share the responsibilities and duties of a trustee as set out in the trust document or in state trust law. This setup is good for families wanting the involvement of a family member or individual, but also the independence and technical expertise of a corporate trustee.
Establishing a corporate co-trustee with a family member ensures that both personal knowledge and professional skills are guiding the administration of the trust.
Charitable Trusts and Organizations
Baird Trust can serve as Trustee or Successor Trustee for charitable trusts and also has a range of options to assist tax-exempt non-profit organizations.
Private Foundations / Private Charitable Trusts
Family foundations provide opportunities to create a legacy and involve future generations in philanthropy. Baird Trust can act as a trustee/director or agent while facilitating gifting decisions of generationally or geographically dispersed family members. Additional benefits may include:
- Centralized collection of grant requests
- Verification of qualified deductibility
- Receipt and record keeping essential to maintaining tax exempt status
- Coordination of all tax reporting
- Allow grants and scholarships to individuals and international causes
Split Interest Trusts
These trusts allow benefits to be split between the donor and the charity either for a lifetime or a period of years.
Charitable Remainder Trust (CRT) CRTs provide an income stream for a donor for their life or a set period of years. At the end of this term for the benefit of the donor, any remaining trust assets pass to a designated charity or charities. CRTs offer many advantages including:
- Ability to defer recognition of capital gain from the sale of assets including a business
- Offer significant income tax charitable deductions to the donor at the time the trust is funded.
Charitable Lead Trusts (CLT) CLTs are also structured as either annuities or unitrusts, but during the initial term of a CLT, payments are made to a charity. At the end of this charitably trust period, any remaining trust assets pass back to the donor or to other family members. The advantages of a CLT include:
- Automate lifetime giving
- Tax efficient transfer of trust remainder interest to family
Board members of non-profits may reduce some of their liability and offer additional development resources by delegating investment management to Baird Trust. In addition to investment management, other benefits may include:
- Developing a tailored Investment Policy Statement
- Reporting unique to non-profit auditing
- Investment social screens
- Dedicated contact for donor stock gifts, reporting, and commission-free trades
- Donor seminars on how donors can efficiently give to the non-profit
Baird Trust Investment Management
Leveraging our proprietary Core + Satellite approach and a long-term holding philosophy, we can work with you to build an investment portfolio that aims to maximize returns and help you reach your wealth goals. Our investment services include:
- In-house expertise in individual equities and fixed income
- Exceptional long-term track records and a history of outperforming all appropriate benchmarks
- Focus on individual securities allows clients to save on fees from mutual funds and exchange-traded funds
Contact the Baird Trust team or find a location near you.