Executing a Trust can be one of the most important estate planning decisions any person or family can make. Funding a Trust changes ownership of assets in ways that allow for ease of management and transfer upon the passing of the person(s) involved in the Trust.
Walnut Creek Trust Administration Law Firm Talbot Law Group has been helping families and trustees carry out their fiduciary duties in a way that ensures everything is taken care of correctly and with minimal stress.
Conscientious, Reliable Advice from a Top Walnut Creek Trust Attorney.
When a trust is established, it must be overseen by an administrator, called the trustee. Often, the trustee and the person the trust is established for are one and the same. In this case, a successor trustee is also named. The duty of the trustee is to manage the real property, funds (cash or investments), insurance, and other assets contained in the trust. The trustee is also responsible for managing the distribution of assets.
As set out by California law, the trustee must act in good faith, according to the wishes of the grantor - the person who established the trust. Trust administration requires careful attention to the grantor’s wishes. A well drafted trust, done by an experienced trust attorney, will outline these wishes in a manner that is clear and straightforward.
Contra Costa Trust Attorney Matthew Talbot has extensive experience guiding families through the trust administration process. He works closely with trustees, fiduciaries, and executors to ensure that the process is as cost effective and efficient as possible.
Matthew has an extremely good reputation with other trust and estate attorneys in Contra Costa County, and works with them to resolve issues that may arise during a trust or probate administration.
The Trust Administration Process
When you're a trustee and a loved one passes away, the last thing on your mind may be administering their trust. Trustees don't have to get started right away, however. Allow yourself a month or so to recover from your loss before diving into your duties as a trustee. It's better not to wait too long though - as the trustee, it is your legal responsibility to act in the best interest of the beneficiaries.
As a Trust Administration Lawyer in Walnut Creek, I frequently help trustees administer their loved one's estates. While it is not required that trustees hire an attorney for the administration of their trust in Contra Costa or Alameda Counties, it is often the case that a few thousand dollars in attorney's fees will save you a great deal of frustration, time, and money in the administration of your trust. An experienced attorney will have performed multiple Trust Administrations and should be highly familiar with your county's court system and way of doing things.
You won't necessarily need to choose an attorney before getting started on the trust administration. The first few steps of a trust administration in California are mostly about gathering information. When it comes to making prudent investment decisions on behalf of the beneficiaries, filing trust tax returns, funding sub-trusts, or transferring real property, an attorney can assist you in properly, and legally, administering your trust.
How Trustees Can Avoid Trust Litigation
If a trust incurs losses due to mistakes or omissions, the trustee can be held personally liable. California Probate code (the law which governs trusts) spells out in detail the steps that must be taken by a trustee. Ensuring that all their responsibilities are upheld puts trustees in the best position to avoid potential lawsuits by beneficiaries and ensuing trust litigation. When it comes to having an attorney do your estate plan or administer your trust, I always say: it's easier to prevent future problems than fix past mistakes.
Overview of Trustee Duties in California
Obtaining certified copies of the death certificate: at least 10 certified copies are recommended
Thoroughly reading and reviewing Trust Documents: Understand all estate planning documents and wishes of the trust's settlors, including their will, distribution plan, and other wishes outlined by the terms of the trust.
Contacting the probate court in your county: Trustees are required by California law to notice all beneficiaries and decedent's heirs. Contra Costa County and Alameda County each require specific forms to do so.
Locating or "Marshalling" trust assets: Obtain deeds of all real property and ensure it is titled in the name of the trust. A complete list of trust assets is often found in Schedule A of the trust document.
Locating ALL assets of the decedent, even those outside the trust: Assets not held by the trust or Payable on Death may be subject to probate.
Obtaining a tax ID number for the trust: When a Trust becomes irrevocable, the trust will need a tax ID number
Provide fiduciary accounting of trust assets to beneficiaries: Income and Principle beneficiaries have the legal right to an accounting, unless otherwise specified by the Trust.
Paying taxes for the decedent and filing fiduciary returns for trust if necessary: Check with an experienced tax attorney or CPA to ensure all taxes are up to date
Distributing funds and assets to beneficiaries: Once the trust administration is complete, all assets must be distributed pursuant to the terms of the trust.
For more details on Trust Administration, check out our article 10 Steps to Administering a Trust in California
3 Tips for Trustees in the SF East Bay
1. Understand the Terms of the Trust
Understanding the terms of the trust is perhaps the most important part of acting as Trustee. If you have questions about any aspect of the trust, consult with a Trust lawyer. It's also important to get clarity on your rights and duties as a Trustee.
2. Invest Wisely
One of the duties of a Trustee in California is to invest trust funds responsibly. California has what is called a Prudent Investor Rule, which requires trustees to act in a reasonable and responsible manner in regards to investments. It therefore follows that trustees should neither let funds or assets sit idle without earning interest, nor should trustees make investments that put trust assets at risk. I recommend consulting with a financial advisor if you questions about how to best invest trust assets.
3. Communicate with Beneficiaries
Frequent and open communication between trustees and beneficiaries can prevent potential litigation due to misunderstandings. Let beneficiaries know what steps you've taken and an approximate timeline for distribution. Communication will help beneficiaries to feel secure and confident that they will receive their inheritance in a timely manner.
The Talbot Law Group offers sound, reliable advice to trustees to ensure complete compliance with each aspect of a trust's administration. As an established firm with a long record of success in Contra Costa County and the SF East Bay, we can help. Learn more about How to Administer a Trust in California.