Cook Islands Trust Funding Checklist

Funding a Cook Islands trust requires a systematic transfer of assets from personal ownership to the trustee’s legal title. This checklist provides a step-by-step framework for completing the funding process correctly, ensuring all necessary documentation is prepared, transfers are executed properly, and the trust achieves effective asset protection.

Use this checklist to track progress through the funding process and confirm all required steps are completed for each asset type transferred.

Pre-Funding Requirements

Before transferring any assets, complete these foundational steps:

☐ Obtain final executed trust deed – Confirm the Cook Islands trustee has the signed trust agreement establishing the trust under Cook Islands law.

☐ Receive trustee contact information – Get the trustee’s official name, address, tax identification number (or grantor’s SSN if using grantor’s number), and contact details for funding coordination.

☐ Complete asset inventory – Create a comprehensive list of all assets requiring transfer, including account numbers, approximate values, and current titling.

☐ Confirm fraudulent transfer timing – Verify with counsel that funding does not create fraudulent transfer exposure based on timing relative to existing or anticipated claims.

☐ Review tax implications – Understand gift tax consequences (if any), basis tracking requirements, and reporting obligations for assets being transferred.

☐ Notify trustee of intended transfers – Inform the Cook Islands trustee which assets will be transferred and obtain any specific documentation requirements or instructions.

☐ Establish funding timeline – Set specific deadlines for completing transfers of different asset categories (liquid accounts within 30-60 days, LLC interests within 90 days, etc.).

Cash and Bank Accounts

☐ Request account transfer forms – Obtain trustee’s standard forms for establishing bank accounts in the trust’s name.

☐ Complete new account applications – Fill out applications identifying the trustee as account owner, provide trust tax ID, and include all required documentation.

☐ Wire funds to trust accounts – Execute wire transfers from personal accounts to newly established trust accounts, maintaining records of all transfer dates and amounts.

☐ Close personal accounts – After confirming trust accounts are funded, close the original personal accounts to prevent continuing to use them.

☐ Update automatic payments – Redirect any automatic deposits or payments to new accounts or alternative arrangements.

☐ Obtain confirmation – Get written confirmation from banks that accounts are established and properly titled in the trustee’s name.

Brokerage Accounts and Securities

☐ Contact brokerage firms – Notify each brokerage holding accounts to be transferred about the intended transfer.

☐ Complete trustee account applications – Submit applications for new brokerage accounts in the trustee’s name with all required identification and documentation.

☐ Provide trust certification – Supply brokerage firms with trust certifications or abstracts confirming trustee authority without disclosing complete trust terms.

☐ Execute account transfer forms – Complete transfer of assets (TOA) forms or ACATS transfer requests moving securities from personal accounts to trust accounts.

☐ Confirm transfer completion – Verify all securities transferred successfully and account balances match between old and new accounts.

☐ Update beneficiary designations – If brokerage accounts have transfer-on-death designations, remove them since the trust now owns the accounts.

☐ Coordinate with investment advisors – Notify investment advisors of the transfer and confirm they can continue managing accounts under trust ownership.

Real Estate and LLC Interests

☐ Identify real estate holdings – List all real property that should be protected through the trust structure.

☐ Determine ownership structure – Decide whether real estate should be held by domestic LLCs (typical approach) with the trust owning LLC interests, or through other structures.

☐ Form domestic LLCs if needed – Establish LLCs in states where real property is located to serve as direct property owners.

☐ Transfer real estate to LLCs – Execute deeds transferring property from personal ownership to LLCs, record deeds with the appropriate county recorders.

☐ Prepare LLC interest assignments – Draft and execute assignments of membership interests transferring LLC ownership from grantor to trustee.

☐ Amend LLC operating agreements – Update operating agreements, identifying the trustee as the LLC member and defining management provisions.

☐ Update state LLC filings – File amendments with state agencies updating LLC membership records where required.

☐ Notify property managers – Inform property managers, tenants, and service providers of the ownership change if necessary for operations.

☐ Update insurance policies – Change property and liability insurance to reflect LLC ownership and add the trustee as additional insured where appropriate.

Business Interests

☐ Review corporate documents – Examine bylaws, shareholder agreements, and operating agreements for transfer restrictions or approval requirements.

☐ Obtain required approvals – Get consent from other shareholders, members, or board of directors if transfer restrictions require approval.

☐ Execute stock or membership assignments – Complete formal assignments transferring ownership interests from grantor to trustee.

☐ Update corporate records – Amend stock ledgers, membership registers, and corporate minutes reflecting the ownership transfer.

☐ File state amendments – Submit required filings with state agencies if ownership changes require public disclosure.

☐ Notify co-owners – Inform business partners, co-shareholders, or other members of the ownership change.

☐ Address operational authority – Clarify whether the grantor continues managing the business as an employee or manager despite trust ownership of equity interests.

Cryptocurrency and Digital Assets

☐ Determine custody approach – Decide whether the trustee will custody cryptocurrency directly or coordinate with specialized cryptocurrency custodians.

☐ Establish trust wallets – Set up cryptocurrency wallets in the trustee’s name with appropriate security measures (cold storage, multi-signature, etc.).

☐ Transfer cryptocurrency – Execute blockchain transfers moving cryptocurrency from personal wallets to trust wallets.

☐ Document private keys – Ensure the trustee has secure access to private keys or multi-signature arrangements for trust wallets.

☐ Maintain transaction records – Keep detailed records of all cryptocurrency transfers including dates, amounts, wallet addresses, and fair market values at transfer.

☐ Coordinate with crypto exchanges – Update exchange account ownership if cryptocurrency is held on exchanges rather than in personal wallets.

Documentation and Record-Keeping

☐ Prepare Forms 3520 – Complete IRS Form 3520 reporting trust creation and initial asset transfers for the year funding occurs.

☐ Document transfer values – Record fair market value of all assets on transfer dates for tax reporting and basis tracking.

☐ Obtain appraisals – Get qualified appraisals for real estate, business interests, or other assets requiring professional valuation.

☐ Compile transfer evidence – Maintain copies of all transfer documents, account statements showing completion, and written confirmations from institutions.

☐ File gift tax returns if required – Prepare Form 709 if transfers constitute completed gifts exceeding annual exclusion amounts.

☐ Update estate planning documents – Revise wills, powers of attorney, and healthcare directives to reflect that significant assets are now owned by the trust.

☐ Notify CPA – Inform tax preparer about trust establishment and funding for proper tax reporting coordination.

Post-Funding Verification

☐ Confirm trustee holds legal title – Verify with the trustee that all transferred assets are properly recorded in trust accounts and trust records.

☐ Close personal accounts – Ensure all personal accounts that were transferred are closed and no longer accessible.

☐ Review account statements – Examine statements for trust accounts confirming correct titling and that all expected assets appear.

☐ Test distribution procedures – Consider requesting a small distribution to confirm the distribution process works correctly and understand timing.

☐ Establish ongoing procedures – Create systems for ensuring future asset acquisitions are titled in the trust’s name rather than personally.

☐ Schedule annual review – Set up annual reviews to confirm trust continues holding all significant assets and no substantial personal holdings have accumulated.

For detailed guidance on transferring specific asset types, see brokerage accounts and investments, real estate transfers, LLC interests, and cryptocurrency. For common mistakes to avoid, see common funding errors. For comprehensive Cook Islands trust information, return to the Cook Islands trust overview.