There was a time when many people associated words like “trust” or “estate” with wealthy people, with the belief that only the rich should be concerned about who should get a hold of their assets when they pass on.
These days, however, more and more people are becoming aware of how important estate planning can be. Whether or not you have a huge house, plenty of cash in the bank or a massive enterprise is immaterial. With estate planning, you get to choose who gets what, even if it’s just a tiny home, a little bit of cash or a few trinkets here and there. At its very heart, drafting a will or setting up a trust is all about protecting your loved ones.
Of course, trusts and estates need to be administered when the time comes. With estate and trust administration, the directions in a will or trust can be routinely implemented, all loose ends pertaining to debts and taxes tied up and the affairs of the whole estate managed.
Here are some of the things you need to know about trust and estate administration.
The Executor and Trustee Can Be The Same Person
It’s entirely possible to name the same person as both the executor of your estate as well as the successor trustee of your trust.
An executor will work with the court in guiding your estate through the probate process, while a trustee is usually tasked with taking over the management of your trust in the event of your death or incapacity.
Some would recommend that two different people fill the said offices as a way of putting checks and balances in place when settling your estate and trust. However, naming the same person as executor and trustee provides advantages as well.
For one, it will minimize expenses, since the lawyer providing assistance in settling the trust and estate only has to talk to one person, which means less work—and payment—for the lawyer and more money for the beneficiaries. For another, having one person play both roles will eliminate any confusion or complications that come with any miscommunication that could happen between two people handling the whole process.
Trustees Can Be Held Personally Liable
The fact that a person has been named as a trustee implies great trust placed on him or her by the grantor.
However, trustees have an obligation to abide strictly by the terms of the trust. If they do so much as using trust assets for their benefit or any sort of wrongdoing related to the trust, they will be held accountable for their actions, and may even be sued in court.
You Can Decline an Appointment as a Trustee or Executor
Let’s assume that you are highly qualified to be named as a trustee or an executor, and you certainly deserve being named as such. However, both offices have a mountain of responsibilities, and you don’t want to be involved in something that has the potential to become messy, especially when there are disputes involved.
Fortunately for you, you can decline any appointment to either office.
If you decline an appointment as executor and the will names no one else, the court will appoint an executor in your place.
If you were named a trustee and you don’t want the job, the grantor of the living trust can simply replace you with someone else.
These are just some of the things you need to know about trust and estate administration. Since things can get complicated, it’s always best to have an estate planning attorney guiding you through the entire process.
About the Author
Lauren Summers is the Content Marketing Strategist for Miller, Miller & Canby, one of the most respected law firms in Montgomery County, and the Washington, DC metropolitan area. The firm focuses on five core areas of practice: Land Development, Real Estate, Litigation, Business and Tax, and Trusts and Estates Law. In her spare time, she reads books and plays board games with her husband and two kids.