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Business trusts, also known as common law trusts, are legal instruments that give a trustee the authority to manage a beneficiary's interest in a business. A business trust can be used as the legal entity that runs the business.
An example of business trust assets might include stocks, cash, real estate, ownership in a company, or items of value. Depending on the terms in the declaration of trust, the trustees may have the rights to sell existing property, buy additional property, or try to expand the assets through business.
Among the chief advantages of trusts, they let you: Put conditions on how and when your assets are distributed after you die; Reduce estate and gift taxes; Distribute assets to heirs efficiently without the cost, delay and publicity of probate court.
A business trust is defined as a trust where the trustee uses the trust assets to do business for profit in order to benefit the trust beneficiary or to further the aims of the trust.The trust protects your assets against personal creditors, because the assets of the trust belong to the trust alone.