Professional Trust Company vs Private Trust Company—The Good, the Bad & the Protector?
Channel: Esquire Group
Date: 2021-04-13

When structuring wealth through a trust, whether the goal is short-term, intergenerational or multigenerational, selecting the company best-suited to maintain the structure is key. And that is where the Professional Trust Company vs Private Trust Company comes into play.

Jimmy Sexton, Founder and CEO of Esquire Group explains the advantages and disadvantages of Private and Professional Trust Companies.

As with most things, there will be advantages and disadvantages to both options.

A Private Trust Company allows greater control of assets, privacy and lower operational costs. However, the setup can be complex, costly, have a higher risk factor and comes with potential tax disadvantages.

A Professional Trust Company allows for ease of setup, knowledgeable and proper management, asset protection, and has no tax disadvantages. However, it comes with a loss of control, privacy and higher ongoing costs.

Alternatively, another option at play is that of a Protector. The protector can pull together a balance that allows for advantages of both the Private Trust Company and the Professional Trust Company. The Protector’s role is to supervise the trustee as well as make and approve decisions, albeit not to impede the trustee.  

Overall, choosing to form a Private Trust Company to maintain control of assets and decisions, means being prepared to manage and operate with full knowledge of the regulations, compliance and reporting requirements, to ensure the benefits of the Trust aren’t diminished. And while a Professional Trust Company offers ease of setup and knowledgeable management, it comes with the disadvantage of loss of control and higher ongoing costs.

To take a look into how Foreign Trusts are taxed, check out our video here: https://youtu.be/lzIQonJpaY0

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Jimmy Sexton, LL.M. is the Founder & CEO of Esquire Group. Jimmy founded Esquire Group with the objective of helping and inspiring wealthy families, investors, entrepreneurs, and high-level executives obtain and gain control over and protect their wealth, via strategic wealth planning. Jimmy started his career in 2003 and continues to service an elite group of clients. In 2005 Jimmy extended services to include tax preparation, which has evolved into Esquire Group’s exclusive Concierge Tax Service. 

This service is offered to a limited number of clients. (submit a request to see if we currently have openings for new clients: https://esquiregroup.com/contact-us/).

Esquire Group is not your typical international tax and wealth advisory firm; we are international business people and global citizens that strive to continue finding ways to provide value to our clients and enhance their lives, giving them peace of mind.