Helping You Navigate The Often Complex Trust Settlement Process
Settling a loved one’s trust can be challenging. Not only must you deal with your own grief, but you must also content with potential legal issues and several details you may know little about.
In addition, depending on the type of trust involved ― whether it is a revocable living trust, irrevocable trust, Bulletproof Trust™, IRA trust, testamentary trust or any other trust ― the settlement and administrative processes can be quite different and difficult to navigate. This is why it is vital to contact the lawyers at The Hughes Law Firm as soon as possible if you have any questions about the trust settlement process.
Since 1974, our attorneys have been helping Colorado families navigate even the most complex estate-related matters, including trust settlements. Contact us today and learn how our team of passionate and caring legal professionals can help you and your family.
Understanding The Basics As A Trustee
When dealing with the trust settlement process, there are many factors you need to be aware of, especially since the law may hold you personally responsible as the trustee for any mistakes or losses:
- Fiduciary duties: It is important to understand the fiduciary duties of the trustee, who is the person in charge of settling the trust. Some of these duties will include securing assets, valuing assets and preparing an inventory and accounting. Since the terms of the trust should set forth the settlement guidelines, it is crucial that you fully understand the authority granted to the trustee and the terms of management and disposition or distribution of trust assets.
- Trust registration: Trust registration statements may be required for certain trusts. The trust registration statement is filed with the court, when required, and notice is given to beneficiaries and contingent beneficiaries of the trust.
- Trustee time and expenses: If the trustee wishes to charge for his or her time in acting as trustee, he or she must keep a detailed log of the date, action taken and amount of time required to complete the task. Trustee fees are subject to the review of the beneficiaries of the trust. Receipts for expenses should be maintained by the trustee and provided to interested parties upon request.
- Inventory and accounting: An inventory of trust assets should include the type of account and value as of date of death. A current valuation for each piece of real estate should be obtained from a professional.
- Subtrusts: Certain trusts dictate that assets cannot be distributed outright to the beneficiaries, but must be held in subtrusts for the beneficiaries. The trustee of each subtrust should know the terms of the trust and what authority is granted under the trust document.
- Tax returns and taxpayer identification number: At the death of the trustmaker, the assets titled in the name of the trust, or payable on death to the trust, may require that a new trust bank account be established. A taxpayer identification number, sometimes referred to as an employer identification number, may need to be obtained to establish a new trust account and to track income after date of death.