The loss of a loved one can be extremely stressful for the survivors of the deceased. In addition to dealing with the grief that accompanies a loved one’s death, there are many things that must be done to settle the deceased’s estate. Probate administration is the legal process of validating the deceased’s Last Will and Testament and administering their estate accordingly. Probate administration is carried out by someone referred to as the executor, personal representative, or an administrator and who has been appointed by the probate.
Similarly, trust administration is the management of trust assets for the benefit of the trust beneficiaries and in accordance with the terms of the trust. Trust administration is usually carried out by an individual or entity referred to as the successor trustee, and who was nominated by the trust settlor to assume management of the trust when the original trustee becomes incapacitated or dies.
There are a number of steps a successor trustee must take to administer a trust, most importantly:
This may sound simple, but there are many laws and procedures that must be followed and, as trustee, you have a fiduciary duty to administer the trust in a manner that both protects and preserves trust’s assets, as well as is in the best interests of the beneficiaries. Breach this duty, and you may be held personally liable to the beneficiaries of the trust.
The three most fundamental types of trusts utilized for estate planning in Florida are as follows:
Both revocable trusts and irrevocable trusts can allow the assets that you transfer into the trust to avoid probate, however the main distinction between the two categories of trusts lies in the asset protection they provide.
Because, a revocable trust allows you full access to and control of your assets, the assets are potentially accessible to your creditors. So, while this type of trust will avoid probate and guardianships, it won’t protect your assets from your own liabilities.
On the other hand, once you transfer assets into an irrevocable trust, you generally cannot take them out. The purpose of an irrevocable trust is to remove control of the assets from their original owner and place that control in the hands of an independent trustee. Due to this structure and the lack of control, your assets are out of the reach of your creditors. Irrevocable trusts are typically utilized to hold life insurance policies, as well to restructure assets for Medicaid eligibility.
A properly funded revocable living trust will allow you to spare your beneficiaries the time and expense of probate and arrange for the management of your assets in the event you become incapacitated. Furthermore, although it won’t avoid taxes or protect your assets from your creditors, a living trust can provide your beneficiaries with creditor protection.
Trusts are especially important if you have children or other loved ones with disabilities or special needs because they can help them avoid the loss of essential government benefits. In addition, the right trust can allow you to have the maximum assurance that after you die, your assets will be transferred to your beneficiaries in the most efficient and effective manner and that they will be taken care of in the way that you intend.
Trust administration is a process that you may find yourself involved in after the death of a spouse or parent who created the trust before passing away. This comes at a very emotional time and is often accompanied by complicated family and financial issues that need to be sorted out.
What’s important to remember about trust administration is that there are certain documents that must be filed and procedures that must be followed. You should also know, however, that if you lack the time, resources or knowledge to fulfill your role as trustee, there are experienced and knowledgeable trust administration attorneys available to assist you.
An experienced trust administration lawyer can assist you in navigating the complicated legal and tax issues associated with trust administration. A good trust administration attorney will lead you through the trust administration process, working with CPAs, financial planners, and other trusted advisors to value the assets of the trust and assist you in successfully fulfilling your role as trustee.
Every family’s situation is different––your needs are different, your goals are different, and your estate is comprised of a different set of assets and liabilities. Therefore, the estate plan that is right for you and your family must be specifically designed with you and your family in mind.
When you begin to consider getting your legal and financial affairs in order, the first thing to do is to contact a reputable Florida probate firm that can help you plan for the well-being of your money, your family, and your life by creating an estate plan that is tailored to your specific needs. For more information, contact an experienced Florida Trust Attorney to arrange a no-cost no-obligation consultation.
Give the Florida Probate Firm a call at (561) 210-5500 to arrange a free consultation. We look forward to serving you.