How does a Trust end?
One strong suggestion is when this time comes: if you have not already retained an attorney to help you with trust administration, do so now.
The Trust agreement, when properly prepared, often contains key components of trust administration to include recitals of successor trustees, distribution provisions, distribution of personal property already made, funding at date of distribution values, proposed final distribution, consent from beneficiaries for final distribution, waivers of accounting if appropriate among other clauses that ultimately protects the successor trustee while obtaining an agreement among the beneficiaries for the final distribution of trust assets. With all that responsibility, please retain an attorney.
This is the last step of a series of steps that should be taken when administering a Living Trust.
While trust administration is largely removed from any court oversight and is managed privately by the successor trustee(s), it is a good idea to formally wrap up a trust (any trust including a revocable living trust) where the settlor(s) (or creators) of the trust have died.
A Trust Distribution Agreement is designed to protect both the successor trustee(s) and beneficiaries of the trust after the settlor(s) has/have died. This document is a formal agreement prepared by the successor trustee(s) that covers the following aspects of trust administration:
- Distribution Provisions (as understood by the parties and governed by the trust)
- Date of Distribution
- Proposed Distribution
- Funding Dates
- Preliminary Distributions (if any)
- Consent to Distribution by Beneficiaries
- Waiver of Notice (if appropriate)
- Waiver of Accounting (if appropriate)
- Reserve Amounts (if appropriate)
It should also include language for governing law and appropriate indemnification clauses. Once such an agreement is prepared and agreed upon by the parties, the successor trustee(s) can finalize the trust and distribute the trust assets.
Consult with your attorney about trust administration and preparing a Trust Distribution Agreement to wrap up the trust. It is one of those things that will give you a peace of mind when administering a trust as a successor trustee.