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Trust Administration

Trust administration is the trustees’ management of trust property. The trustee must follow the terms of the trust document for the benefit of the beneficiaries after the settlor’s death. It is not a court-supervised process.

The ultimate goal is the transfer of property from an individual who has died (the “decedent”) to that individual’s beneficiaries who are identified in his/her revocable living trust.

The decedent is also called the settlor of the trust. It was settlor’s money during the person’s life and is now being transferred after death.


The Basics of Trust Administration After the Settlors Death:

  • Notice to all beneficiaries.
  • Obtain federal tax identification number.
  • Ascertain assets, such as property, bank and investment accounts.
  • Prepare inventory.
  • Transfer the title of assets into name of successor trustee.
  • Pay settlor’s debts and satisfy his or her liabilities.
  • File tax returns and pay taxes owed.
  • Keep detailed records.
  • Prepare accounting and provide to beneficiaries.
  • Once all of the above is done distribute remaining assets.

Advantages of Trust Administration Versus Probate:

  • Potentially quicker distribution of the property to beneficiaries
  • More privacy due to there being no court supervision.
  • Less expensive manner of distributing property to beneficiaries.
  • Disadvantages
  • Lack of court supervision means there is no mechanism for dispute resolution.
  • Lengthens time a creditor has to pursue a claim. In a probate action it is limited to four months without that

Duties of the Trustee

  1. Duty to administer the trust for the benefit of the beneficiaries.
  2. Duty of loyalty so act solely in the interest of the beneficiaries.
  3. Duty not to delegate to other persons that which can reasonably be performed by the trustee.
  4. Duty to keep records and account for trust assets.
  5. Duty to provide information to beneficiaries if it is requested.
  6. Duty to exercise reasonable care and skill in managing trust property.
  7. Duty to keep, control and protect trust property.
  8. Duty to enforce claims owned by the trust.
  9. Duty to defend legal actions.
  10. Duty to Deal Impartially to the Beneficiaries.

Being the trustee is a big deal. You have fiduciary obligations to all of the beneficiaries of the trust to protect the trust assets and to distribute them according to the terms of the trust. The trustee makes many complex financial decisions. At Kile & Kupiszewski we have substantial experience advising trustees and assisting them with trust administration. We have a flexible rate schedule that will accommodate any situation based on the size and complexity of the trust. Give us a call to discuss your situation and how we can help you fulfill your trustee duties.

 



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