Saturday, August 23, 2014

Trust Administration


Whether you have created a simple revocable living trust or a more complicated trust-based estate plan, your death or your spouse’s death will trigger the need to administer certain  terms of the trust.  This duty can be as simple as distributing assets to a beneficiary and terminating the trust, or as complicated as funding sub-trusts and reallocating assets for ongoing trusts.  The importance of trust administration cannot be emphasized enough.

The first step in protecting your estate is creating a personalized plan.  However, in order to be effective, your estate plan must be executed according to the terms of your trust and/or will.  One of the myths regarding setting up a living trust is that it completely avoids legal or administrative costs similar to the cost of probate.  This is untrue as a trustee must fulfill fiduciary duties and comply with the Probate Code as well as federal and state tax law in carrying out the terms of your trust.  Even for the most sophisticated trustee, these duties can be overwhelming.  Trustees are allowed to hire attorneys and accountants in order to help them meet their duties.  This of course may add to the cost of having a trust, however, the costs of administration are still significantly lower than that of probate.

Our trust administration services are designed to alleviate a trustee’s stress of complying with fiduciary duties and tax law.  We can make sure notice and accounting requirements are met and that the terms of the trust are carried out according to the trustor’s wishes.  If there are bypass trusts, marital deduction trusts or other sub-trusts to be funded, we will make sure that asset valuations and allocations are done and any title transfers are properly recorded.