Creating a trust for a child is one way to ensure a child receives designated funds when he or she becomes an adult.  There are several advantages to creating a trust.  The least of which is, the assurance that a child will receive funds when monies are most needed, such as a college trust fund.  There are also tax advantages to creating a trust that will benefit both the child designated to receiving the trust and for the person who creates the trust. Seek advice from a tax advisor to gain the greatest benefit for the child and the person interested in creating the trust account.http://life.familyeducation.com/trust-funds/money-and-kids/48035.html

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Trustor-The person who creates the trust

Trustee-The person responsible for the trust

Trust Property-Money or real estate placed in trust

Trust Purpose-The reason for the trust creation

Beneficiary-The person who ultimately benefits from the trusthttp://money.cnn.com/retirement/guide/estateplanning_trusts.moneymag/index2.htm

Section 2503(b):  Income must be distributed to the child while a minor.  Monies can be placed in a custodial account.  The child is provided the right to withdraw an amount equal to or greater than the annual gift tax exclusion.  However, because the child is a minor, a parent or guardian may choose to decide whether or not the child may exercise this right.

Section 2503: Allows trust income and principal to be used for the child until the child reaches the age of 21.  Upon reaching 21, the child may decide to withdraw funds or continue the terms of the trust.

Higher Education Trusts:  Most states allow a trust to be built for the purpose of in-state tuition for a minor.  Contact your state government for details.

Revocable Living Trusts:  This trust can be changed at any time upon creation.  The trust can be closed or the terms of the trust can be alerted at any time.  A trust such as this, is highly flexible and generally not very good for tax purposes.

Testamentary Trusts:  This type of trust becomes active upon the death of the person who creates the trust.  A trust such as this, can be created from property remaining from property remaining after a will is probated.  

Irrevocable Trusts:  This is one type of trust that offers a great deal of protection to the person who creates the trust and the beneficiary.  This trust, is inflexible and is generally ideal for tax purposes. http://www.companydatabase.org/c/trust-service/fund-trust/...trust/mutual-fund/