If you need assistance with administering your trust, whether one you created or one which you’ve inherited, we can help you. Our office not only prepares trusts as part of our estate planning; we also represent families in the ongoing administration of their trust estates. In this article, we will explain how trust administration works and help you identify when you need to hire a lawyer for trust administration.
What is trust administration?
Trust administration broadly refers to doing the tasks required of the trust document, as well as paying out any distributions from the trust. Think of administration is carrying out the directives of the trust, similar to how an executor of an estate carries out the directions of a will.
When a person dies with a will, their chosen executor must file a probate case and ask the court to distribute the estate according to the terms of the deceased person’s will. We call this “administering the probate” or “estate administration.” However, when a person dies and leaves behind all of their property in a trust, the successor trustees of the trust will have to administer the trust’s property. We refer to this as Trust Administration.
Who needs a lawyer for trust administration?
Trust administration involves many different people who may be part of the trust. This could include the
- Trustee or successor trustees;
- Surviving spouse;
- Beneficiaries;
- Children or grandchildren of a deceased person that created a trust;
- Charities, churches, or non-profit organizations.
If you inherited property, and that property is owned by a trust, you will need to meet and discuss with the trustee about receiving your distributions. Depending on the terms of the trust, this could be as simple as receiving a check. Or it could mean that you’ve inherited a sub-trust with a third-party trustee managing the funds or property of the sub-trust.
The type of person who most urgently needs to meet with an attorney for trust administration is the surviving spouse involved in a joint trust. This is because there are tax decisions and certain elections that must be made in the months after the death of the first spouse. And the surviving spouse will need the assistance of an attorney and/or an accountant to make those elections and decisions.
When do I need to hire a lawyer for trust administration in Oklahoma City?
Remember this: the purpose of trust administration is to make sure we actually accomplish the original purpose of why we created the trust in the first place. There are many reasons for creating a trust and placing assets inside of it. However, it is not until the original grantor dies that we actually get to see those goals play out. In order to carry out the wishes of the original grantor, we must take administration seriously. Trustees actually have a fiduciary duty to carry out the objectives of the trust. And that means timely getting to work.
If your spouse recently died, and your spouse had a created a trust, then you should contact our office to schedule a consultation. We need to discuss trust administration, whether to file a Form 706, and other matters involving tax elections.
When we create trusts for our clients, we often do so in a way that creates asset protection for the surviving spouse, as well as flexibility on the executor of the estate when making tax elections. However, those decisions need to be made in a timely manner after the death of the first spouse. This is all can be done at our office and can provide guidance to you as you administer your deceased spouse’s trust.
Trust administration can be something that is ongoing all year long, every year. Or it can be something you need at certain milestones in a lifetime. It depends on the trust and the family or persons involved.
How does trust administration work?
Trust administration is simply the day-to-day operations of administering the property owned by a trust. If the trust is simple and the estate is small, the administration could be a one-time event. However, even modest estates usually require more work than what the family initially realizes. And it’s important to meet with your lawyer as soon as possible to ensure that things such as unused exemptions of the deceased are not lost or barred.
If the trust is complex and the estate is larger, the administration could be a very time-consuming activity, similar to a full or part time job for the trustee.
A trust is an agreement between the grantor and the trustee, where the trustee agrees to hold title to the grantor’s property, and distribute the property or the income it generates to the beneficiaries. Therefore, the nature of the trust property is a big factor in determining how much administration is necessary. Next, the structure of the trust, and whether sub-trusts are created, whether asset protection features are made apart, and of course the family dynamics or relationship of the parties surely plays a role.
Good trust administration starts with meeting with your attorney to review the trust, the people involved, and the trust assets. Discussion should include any immediate tax filings or forms, as well as how to make introductions to the people involved in the trust.
Meet with Oklahoma City Trust Administration Attorney
Travis Charles Smith is an Oklahoma City Attorney that represents families in need of trust administration. Whether you are a surviving spouse, a child or beneficiary of a trust, or a third-party trustee, Travis is available to guide you through this new chapter of administering your trust documents.
To schedule a consultation, call our office at (405) 607-7799 or send us a message.