Getting it Right, Now.
Although a revocable living trust, if properly drafted and funded, will avoid the necessity of probate, the estate of a decedent must still be formally administered. After the death of a Trustor (the person who created the trust) there are several tasks that the administrator(s), also known as the successor trustee(s), must complete to administer the estate of the decedent. Generally, the basic duties of the trustee include the collection, management, and distribution of the trust estate. The trustee has a fiduciary duty to strictly follow the terms of the trust and must use ordinary care and diligence in managing and distributing the trust assets. A trustee can be held personally liable if they violate their fiduciary duties.
For joint trusts (typically involving a husband and wife) there are tasks to complete at both the death of the first trustor and at the death of the second trustor.
The following is a brief summary of the steps required to administer a trust:
- Properly notifying all beneficiaries and heirs of the death of the trustor(s).
- Collection and valuation of the assets comprising the trust estate.
- Completing basic “administrative tasks” including obtaining a tax identification number for the trust and sub-trusts, setting up bank accounts, and funding any sub-trusts.
- Paying trust debts (including any taxes owed) and expenses relating to the administration of the estate.
- Preparing an accounting for the beneficiaries.
- Distribution of the assets in strict compliance with the terms of the trust.
Lewis Business & Estate Planning has extensive experience administering estates and trusts of all sizes. Following are some of the services we regularly provide in connection with the administration of trusts and estates:
- Representing the executor and/or successor trustee throughout the trust administration process to ensure that all statutory requirements are met, including but not limited to preparing notices to beneficiaries and required accountings;
- Providing advice regarding the trust to ensure the trust terms are strictly followed with respect to administration and distribution of the trust estate;
- Working with the clients CPA in the preparation and filing of the Form 706, U.S. Estate Tax Return;
- Advising on postmortem planning for the surviving spouse such as effective use of tax elections and/or disclaimers and issues pertaining to non-U.S. citizen spouses;
- Advising on and coordinating special distributions such as charitable bequests; and
- Structuring the administration to maximize estate tax benefits.
Losing a loved one can be a very traumatic and stressful event, and hiring counsel to navigate through the legal and practical issues resulting from the death of a family member can be extremely helpful. If you need assistance with the administration of an estate or living trust, please contact us to schedule a complimentary consultation at (714) 581-8808.