What Does Trust Administration Entail?
Typically, a trust is a legal document where the management of an asset is separated from the benefits of the asset. Trust administration refers to the management of assets held within the trust after a decedent’s passing. The trustee, who manages the trust, is responsible for trust administration. Trust administrators hold the duty of fiduciary, meaning the trust administrator is charged with protecting the trust assets. The written instructions & legal statutes each trust will determine the duties of the trust administrator. In many cases, Cary trust administration attorneys can assist the trustee in administering his or her duties and responsibilities. Trust administration requires that the trustee have at least a basic understanding of the laws related to estates and trusts. When a trustee makes trust decisions without the necessary legal and financial knowledge, costly mistakes can result. The trustee takes on personal responsibility – and in some cases liability – for their management of the trust.
As the trustee of a loved one’s trust or estate, you may not fully understand the scope of your responsibilities. A poorly constructed living trust may result in costly mistakes. Determining what to do and when to do it can be extremely stressful but having strong Cary trust administration attorneys by your side can make a significant difference. The NC Planning attorneys will provide sound, insightful guidance, and advice in a timely manner. We will help the trustee through this challenging time, ensuring the decedent’s wishes are properly carried out.
Planning for the Road Ahead
If one is not familiar with trusts, you may not have a clear picture of what trust administration attorneys do, or how they could benefit you. Trust administration attorneys can assist trustees of individual trusts. Administering a trust can be overwhelming, particularly if the decedent was a loved one whose death you are grieving. Even when the trust is clearly spelled out, difficulties can unexpectedly arise. Depending on the specific details of the trust, trustees might be expected to do the following tasks:
- Interpreting the decedent’s intent/wishes
- Determine what monies are owed to the trust, then collect them
- Pay all debts and expenses associated with the trust
- Obtain all records and documents necessary to properly administer the trust
- Maintain an ongoing inventory of all trust properties
- Manage any trust investments
- When necessary, consult tax, legal, and financial advisors to ensure the trust is properly administered
- Have trust assets valued or appraised
- Sell trust property when necessary
- File tax returns for the trust
- Keep accurate records of all trust expenditures and income
- Execute necessary documents that will transfer titles of trust properties to beneficiaries
- Provide necessary information to trust beneficiaries
- Distribute trust properties and income to beneficiaries on an ongoing basis
As one might imagine, handling all these necessary tasks can place an enormous burden on the trustee’s shoulders. Making an appointment with Cary trust administration attorneys from NC planning can help relieve that burden. The unknown of trust administration can be extremely stressful. Once a trustee meets with our knowledgeable attorneys, that stress is alleviated, leaving a sense of calm and order. As trustee, you could face liability for failing to comply with the law or terms of the trust. There are also strict timelines and record-keeping obligations placed on trustees by the courts and individual state law. Seeking early assistance from the compassionate NC Planning trust administration attorneys is imperative to the outcome.
Legal Definitions
The following legal definitions associated with trust administration can help you more clearly understand the process.
- Trust—A legal document that details how a person’s assets will be managed during the person’s life and after their death
- Trustor/Grantor—The person setting up the trust
- Trustee—The person in charge of the trust (can be the grantor of the trust)
- Successor Trustee—The person appointed to handle the trust when the original trustee has become disabled, is unable to serve, or no longer wishes to serve
- Survivor Trustor/Trustee—When a trust is set up as a joint trust and one spouse dies, the surviving spouse is known as the survivor trustor/trustee.
- Revocable Trust—A trust that can be altered by the grantor at any time, including changing beneficiaries and adding or removing assets from the trust
- Irrevocable Trust—Unlike a revocable trust, once an irrevocable trust has been set up and funded, it generally cannot be changed by the grantor. Irrevocable trusts offer tax benefits as well as protect assets from creditors or divorce settlements.
- Fiduciary—A person or organization charged with acting in the best interests of others.
- Beneficiary—Those named by the grantor of a trust to inherit assets the estate upon the grantor’s death
- Remainder beneficiary—A person or entity that will receive anything remaining in an estate after specific assets have been distributed.
What Are Common Issues Associated with Trust Administration?
Although trusts can be among the most important, versatile tools in estate planning, the trustee appointed to look after and distribute assets following the grantor’s death can encounter certain issues. These issues include:
- There are allegations of mismanagement of trust assets—A beneficiary may allege the trustee is not managing the trust’s assets in accordance with the decedent’s instructions.. Unfortunately, such a claim can be made with no factual evidence. A beneficiary may simply disagree with the manner in which the successor trustee is managing the assets in the trust.
- A beneficiary disputes the successor trustee’s right to administer the trust—This could occur when the language of the trust is vague or simply because a beneficiary wants to challenge the trustee’s authority.
- Beneficiaries demand immediate distribution of assets—While trust documents generally state the conditions for beneficiary distributions the trustee may have a certain level of discretion. This could cause beneficiaries who want their inheritance immediately to challenge the distribution timetable.
- The trust has outdated terms or provisions
- A beneficiary is incapacitated or deceased—and this is not addressed in the trust
- Assets that were never legally transferred into the trust must be dealt with
- A beneficiary contests the trust—the trustee may be challenged to show evidence that the grantor had the necessary capacity to create a trust
How to Select the Best Trust Administration Attorneys for Your Current Situation and Future Needs
North Carolina trust and estate laws can be complex, regardless of the type of trust established. Because of this, it is extremely important to have legal representation—both in setting up the trust and during trust administration. You will want to choose Cary trust administration attorneys who are trusted professionals and can handle every detail of the trust administration. At NC Planning, our legal team handles trust administration for modest estates as well as complex estates with interests and assets across jurisdictions. Our experience has earned us the trust and loyalty of clients throughout North Carolina..
How NC Planning Will Help You Plan for the Road Ahead
Cary trust administration attorneys from NC Planning will always take the time to fully understand your trust administration needs prior to making any recommendations. We have the necessary legal resources and skills to handle all trust administration matters. As the designated trustee of an estate, your task is to remain compliant with state and federal laws while ensuring the wishes of the decedent are carried out.
This can be a daunting task, made considerably easier by having deeply experienced advisors from NC Planning by your side. We are strong believers in open communication, responsiveness, accountability, and compassion and will use these to your advantage. Contact NC Planning today for assistance with trust administration or other estate planning issues. With offices in Cary, NC, and Raleigh, NC, the NC Planning attorneys are ready to schedule a consultation with you and discuss your needs.
