Tennessee Funeral Service Laws Rules & Regulations (LRR) Practice Exam

What is the purpose of a trust in funeral service?

1. To manage the estate of the deceased

2. To secure funds for future funeral expenses

3. To distribute property to heirs

4. To avoid taxes on the estate

The correct answer is: To secure funds for future funeral expenses

The purpose of a trust in funeral service, particularly when referring to a funeral trust, is primarily to secure funds for future funeral expenses. This allows individuals to set aside money specifically for their funeral costs, ensuring that those funds are available at the time of need. By establishing this trust, people can alleviate the financial burden on their loved ones during a difficult time and ensure that their funeral arrangements are honored according to their wishes. This mechanism also typically comes with certain protections, as the funds in a funeral trust are often designated to be used solely for funeral-related expenses. This specificity helps in managing the funds more effectively and ensures that they are specifically allocated for the intended purpose, rather than being mixed with other estate planning elements. While other options such as managing the estate, distributing property, and avoiding taxes may play significant roles within comprehensive estate planning, they do not directly relate to the specific function of a funeral trust, which is focused on pre-funding funeral expenses.