Torrance Trust Administration Lawyer
Trustees have many fiduciary duties when administering a trust, and with fiduciary duties come potential financial liability if those duties are not upheld. Ensuring that a trust is competently administered is no easy task, especially if the trustee does not have a background in the law or trust administration.
Trust administration requires careful attention and commitment
Ideally, a grantor (the title for a trust’s creator) would have a conversation with the person he or she designates as trustee when creating a trust, explaining the responsibilities involved in serving as trustee. In many cases, trustees do not learn what is entailed in being a trustee — nor whether they are up to the task — until the grantor has died.
While some trustees simply lack the time or attention to detail required to serve as a trustee, a small minority either ignore their duties entirely or take advantage of the role by embezzling from the trust fund. Not only is it critical for trustees to take their duties seriously; it is also critical for grantors to choose a trustee who is up to the task.
If you have been designated as a trustee or are in the process of selecting the person you wish to serve as trustee for your trust, learn more about trust administration duties below. Find out if you might benefit from professional legal guidance on trust administration by contacting the seasoned Torrance trust administration law firm Samuel Ford Law.
What does a trust administrator do?
A trustee’s most essential job is to act in the best interests of the beneficiaries of the trust and of the estate itself—in fact, they have a legal obligation to do so. A trustee is tasked with carrying out the instructions laid out in the trust creation document. This could mean that a trustee’s duties will wrap up in a matter of months or could require a years-long commitment.
Some of the essential tasks of a trustee include:
- Notifying beneficiaries and heirs at law: The California Probate Code requires that all interested parties, including persons listed as beneficiaries in the trust and the grantor’s legal heirs (spouse, children, etc) receive notice that complies with the Probate Code within 60 days of the grantor’s death. The Department of Health Services must also receive notice within 90 days, and, if the trust holds real property, a Change in Ownership Statement must be filed with the county assessor within 150 days.
- Inventory and take control of all trust assets: Another important early step in the trust administration process is to locate all of the grantor’s assets and, comparing this inventory with the trust, determine which assets were included in the trust and which were left out. In some cases, trustees may petition to have certain assets deemed included in the trust, even when the trust doesn’t formally list them. If this strategy isn’t available, those assets may need to go through probate. The trustee must also take steps to take control of the trust assets and transfer title to the assets into the trustee’s own name. In the case of real property, this may include signing and recording an affidavit – Death of Trustee.
- Review and understand trust documents: It is critical that a trustee understand every aspect of the trust documents and review them early on after the grantor’s death. The trust document will not only contain the instructions for the distribution of the trust assets, but may also spell out very specific instructions that the trustee must follow for a variety of potential situations. Failure to follow the written instructions in the trust can cause the trustee to be personally liable for any damages.
- Determine the value of the estate and pay any bills: The trustee must create a valuation of the estate as of the date of the grantor’s death. This entails learning the values of any financial accounts, real estate, personal property, and business interests. The trustee will also need to ensure that any outstanding debts of the estate are paid.
- File tax returns: Once a valuation of the estate is complete and debts have been paid, the trustee should then file a tax return on behalf of both the grantor and, potentially, the estate itself. Trustees would be well-advised to consult with an experienced estate tax attorney on this subject.
- Begin distributions to beneficiaries: Only once all payments have been made, titles have been transferred, and accountings have been completed should the trustee begin distributing trust assets to beneficiaries. This is the final step in the trust administration, but it may go on for years if the grantor created a trust which pays out to its beneficiaries slowly over time.
Experienced legal assistance with trust administration in Los Angeles’ South Bay
As you can see, acting as a trustee is a demanding role that can overwhelm even seasoned professionals. While non-lawyers are permitted to serve as trustees, guidance from an attorney with experience in trust administration is strongly recommended. At the Torrance trust administration law firm Samuel Ford Law, we have over a decade of experience in the field of trusts and estate planning. We are ready to provide California trust administration for estates both small and large. Let us use our knowledge of the field to guide you through the process of capably administering a trust in the South Bay of Los Angeles. Contact a Torrance trust administrator at Samuel Ford Law for a consultation today.