In creating a trust, the settlor appoints a trustee (usually him or herself), nominates successor trustees (typically family members) and funds the trust with assets. Upon the settlor’s incapacity or death, the first successor trustee assumes the trust administration duties. Most successor trustees, however, are unprepared because they lack trust administration knowledge and experience. They need the help of an experienced trust attorney. Nevertheless, certain steps must be taken to preserve favorable tax treatment (if applicable), and to fulfill their fiduciary duties. This is called “trust administration.” Its complexity depends on a variety of factors, including the type of trust, subtrusts, trust assets and the opportunity to eliminate or minimize estate taxes. Here is a basic outline of that process.
liable to beneficiaries for a substantial sum of money.”
Trustees should hire a trust attorney to assist them in the trust administration process. Even experienced, professional trustees would never attempt to administer a trust without the advice of an experienced trust attorney. We have the experience you need. We can help minimize your personal exposure to liability while reducing your stress. Moreover, we will guide you in the right direction. Here is a sample client memo.
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