Conduit Trust

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What is a Conduit Trust?

A trust that funnels retirement plan distributions directly to beneficiaries rather than holding the funds in the trust.

A type of trust designed to receive and distribute retirement plan assets to beneficiaries. The trust acts as a “conduit,” passing on required minimum distributions (RMDs) to beneficiaries without accumulating income. This structure allows the retirement account to maintain its tax-deferred status while ensuring that the trustee does not have discretion to retain funds within the trust. Conduit trusts are often used in estate planning for tax purposes.

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