Chico trust administration does not have to be a mystery. When you plan your estate, you record your final wishes about the way you want your assets to be distributed.
At the same time, you should also consider the trust administration phase that will take place after you are gone.
Revocable Living Trust Administration
The most commonly used trust in the estate planning realm is the revocable living trust. As the name would indicate, you can rescind or revoke the trust at any time. Plus, you would act as the trustee while you are living, so you would have complete control every step of the way.
When you draw up the trust declaration, you name a successor trustee to administer the trust after your passing. This is an important decision, and there are some key factors to consider when you are choosing a trustee.
Trustee Qualities
A living trust trustee should be someone who has a good bit of financial acumen. The extent of the knowledge that is necessary will depend on the way the trust is structured. Some trusts are designed to remain active for years to provide ongoing distributions to beneficiaries.
This can involve managing investments over the long haul. In other cases, the trustee will be instructed to distribute all the assets right after the passing of the grantor of the trust.
Geography is a factor, and you should consider real or perceived conflicts of interest. Longevity will be another consideration, and you have to make sure that the person that you choose is willing to assume the role.
If you don’t know anyone personally that fits the bill, there is another option. There are professional fiduciaries that handle trust administration duties. Yes, there is a fee involved, but it can be money well spent under certain circumstances.
Trust Administration Overview
After the passing of the grantor of the trust, the trustee will spring into action. They will obtain copies of the death certificate, and they will identify and notify the beneficiaries. The trustee will send notifications to the Social Security Administration and the state Department of Health.
Assets in the trust will be inventoried and secured, and final debts must be paid, so they will obtain a Taxpayer Identification Number. If there are investments, they will be evaluated, and final debts will be satisfied.
Ultimately, assets will be distributed to the beneficiary or beneficiaries in accordance with the wishes of the grantor. As we have stated, this can be a one-time event, or a trust can be set up to provide distributions over an extended period.
Other Types of Trusts
Aside from the revocable living trust, there are other types of trusts that satisfy specific objectives. For example, many people with disabilities rely on Medi-Cal and Supplemental Security Income. These are need-based programs that are only available to individuals with limited resources.
A direct inheritance could potentially impact eligibility, but there is an estate planning solution in the form of a supplemental needs trust. The trustee can use assets in the trust to satisfy the unmet needs of the beneficiary, and the existence of the trust would not interrupt the benefits.
Trust administration for this type of trust takes on a different complexion because the trustee must fully understand the government benefit guidelines. This is one example of the nuanced trust administration scenarios that can enter the picture.
We Help with Trust Administration in Chico, California
Our firm can help if you need legal guidance to help navigate the trust administration process. You can call us at 530-343-3454 to schedule a consultation at our Chico, CA estate planning office, and you can alternately send us a message through our contact form.