What is a grantor?
A grantor is the person who creates a trust and transfers property into it, also called the settlor or trustor.
A grantor is the person who creates a trust and funds it.
Where the word "Grantor" comes from
Grantor comes from the Latin grantare, to give or bestow. In trust law it names the creator of the trust, the one who transfers property to a trustee for the benefit of others, and the role is central to how trusts are interpreted.
Why Grantor matters
The grantor's intent controls the trust. Courts read the trust document to give effect to what the grantor wanted, and the grantor's powers, whether to revoke, amend, or direct distributions, define the trust's character for tax and legal purposes.
Common confusion about Grantor
The grantor is not the trustee or the beneficiary, though one person can hold more than one role. A person can be the grantor and the sole trustee, or the grantor and a beneficiary, but each role carries different duties and rights, and confusing them leads to mistakes in trust administration.
A real-world example of Grantor
A man creates a trust, transfers his investments into it, and names his wife as beneficiary and a bank as trustee. He is the grantor, and the trust document spells out his retained powers, such as whether he can change the beneficiary.
A worked example of Grantor
A grantor creates a trust for her grandchildren and names herself as trustee. She retains the power to revoke the trust and to direct distributions, which makes it a revocable trust, so she can dissolve it at any time and take the assets back. When she later gives up the power to revoke, the trust becomes irrevocable, and the change has immediate tax and control consequences that her advisors must account for.
How Grantor works in practice
When you create a trust, state your powers clearly, because retained powers affect both control and taxes. Keep a copy of the trust and a schedule of assets, and tell the trustee and successor how to administer it. If the trust is irrevocable, understand that your role as grantor is largely complete, and the trustee now answers to the beneficiaries.
Questions about Grantor
Is the grantor the owner?
They were, but funding moves legal title to the trust.
Can the grantor also be trustee?
For a revocable trust, often yes.
What if there are two grantors?
A joint trust can name both spouses as grantors.