Working with a trust attorney is vital to ensuring the Trustee is protected in fulfilling his or her legal obligations. A trust attorney can also help ensure the trust’s beneficiaries receive the maximum potential benefits according to the terms of the trust, and any applicable estate taxes are minimized.
Guiding families through the trust administration process.
Whether you reside in Oregon or Washington, We can help. Gevurtz Menashe estate planning attorneys have extensive experience helping clients navigate issues in trust administrations. Call 503-227-1515 or contact us online to schedule a consultation.
Trustor vs. Trustee
First, it is important to understand who the various parties are in a trust. A Settlor or Trustor is the person who creates the trust. A Trustee is an individual or entity that has the authority to manage the assets owned by the trust according to the trust’s terms. A beneficiary is an individual or entity entitled to receive a benefit from the trust, such as cash or the right to use certain property. The Trustee is required to manage the trust assets for the benefit of beneficiaries according to the trust’s terms.
Revocable Trusts—The Settlor
In a revocable trust, the Settlor is also typically the Trustee and the beneficiary of the trust for the Settlor’s lifetime. Upon the Settlor’s death, however, the parties to the trust change. A new Trustee, called a successor Trustee, is named in the trust document to step in and administer the trust. The beneficiaries typically change from the Settlor to other individuals or entities, such as family members, friends, or charities. Additionally, upon the Settlor’s death, the successor Trustee will be authorized and obligated to pay the Settlor’s final debts and expenses, handle any tax issues which may arise, and distribute the remaining trust assets to the beneficiaries in a timely and proper manner.
How Does It Work?
Although court involvement typically is not required, successor Trustees are bound by state law and the terms of the trust to properly administer the trust. A successor Trustee is subject to a number of duties and obligations which must be performed within certain timeframes. The Trustee is required to provide the beneficiaries with certain information and keep the beneficiaries’ best interests in mind throughout the trust administration process.
An experienced trust lawyer can assist a successor Trustee in properly administering a trust. The lawyer can help the Trustee successfully navigate complicated tax issues, conflicts between beneficiaries, and help ensure the Trustee is protected by following all applicable laws.