Family Trust Liability
My parents assets were put in a family trust, for 4 siblings. My father has sinced passed and Mom is not mentally capable anymore. Some of the money was used fm the trust to start a business for my 2 brothers, initially as a C-Corp. They recently changed it to an S-Corp at the recommendation of their accountant to help out on income taxes to the trust. Question is, are they putting the remainder of the family trust at risk with either a failed business or law suit. The balance of the initial loan will be paid off next year.
1 Answer from Attorneys
Re: Family Trust Liability
If all that's been done is borrow money from the trust to start a business, then the only risk to the trust is that the loan may not be repaid.