When You Become the Successor Trustee, Here's Why You Need an Attorney?

By following out the wishes of the deceased, a successor trustee is an important part of the estate planning process. They are responsible with managing the assets, paying existing bills, and transferring the assets to the chosen beneficiaries after the trustee dies or becomes disabled as the one listed in the trust.

If you've existed named as the successor trustee, you should speak with an Orange County estate planning lawyer to figure out what you should do next.

Let's look at what a successor trustee is responsible for and when a trust attorney is required.

Successor Trusteeship Responsibilities

If you've existed named as the successor trustee for a trust, you might be wondering what your responsibilities are and whether you're up to the position. Both of these topics are crucial to think about because this role comes with a lot of duties.

The grantor (the person or couple who established the trust) is incompetent or dies, you, as the successor trustee, become the trust's manager. This means you're in charge of the assets, which could include investing them in a way that maximizes growth while limiting risks.

In that situation, you'll need to assess the trust's assets, as well as the trust's revenue and expenses. Other duties could include making sure final tax returns are filed, collecting death benefits, and transferring assets to beneficiaries.

It is critical that you desire legal advice from an Orange County estate planning attorney as soon as your responsibilities begin.

For a better understanding, consider the following instances, which frequently benefit from legal counsel.

A Trustee's Asset Wasn't Included

A trust is a legal document that is similar to a contract in that it is used to hold valuables and give instructions on how they should be distributed. The estate owns the valuables. If the owner acquires assets after the trust is established but fails to add them to the trust, a probate court may be needed to assess the trust's lawful distribution. The easiest method to avoid going to court and save money and taxes in this scenario is to make sure the trust is fully funded and that all beneficiary designations are current. Should you discover that any assets have not been funded to the trust after taking over as successor trustee, you will need the help of an Orange County estate planning attorney to sort out the details.

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A/B Trust Planning is Included in the Trust.

Managing a simple revocable trust is challenging enough. When you add in the A/B trust, you'll need the help of an Orange County estate planning attorney.

Estate planning experts frequently form up A/B trusts to assist married couples and avoid additional estate taxes. When the first spouse passes out, the trust splits and part of it becomes irreversible.

An A/B trust can protect beneficiaries and asset distribution to them after the death of one of the spouses in blended families with children from various marriages. If you're a successor trustee dealing with an A/B trust, you'll almost certainly require the help of an Orange County CA estate planning attorney.

The Trust Holds a Beneficiary's Inheritance

Dealing with purchases held in a trust can be complicated, whether because of specific instructions or because the recipient is too young to accept an inheritance. Over the trust's or a person's lifetime, a trust may require specific distributions, such as income.

It is the job of a successor trustee to carry out the trust's terms and carefully manage the assets. It's crucial that you understand your responsibilities as successor trustee and consult with an estate counsel about the main terms.

Taxes are due from the estate.

If a successor trustee distributes assets to beneficiaries before paying taxes, they may be held liable if the trust does not have the funds or assets to pay the taxes in full. If you're unsure whether or not taxes must be paid as a successor trustee, speak with an Orange County estate planning attorney to guarantee that the proper tax returns are submitted and paid.

The Grantor was the proprietor of a company.

You are liable for all the assets placed in the trust as a successor trustee. When a business stake is held in a trust, the successor trustee is responsible for running the business, closing it down, or even selling it. One of the trustee's responsibilities is to diversify the trust's investments, thus many people decide to sell.

Some trusts choose an investment advisor to supervise all business interests and conduct continuing operations for families who wish to keep their firm. This individual is then in charge of keeping or selling business assets in accordance with the trust's instructions, and the trustee must follow them.

Another possibility is that the trust named a businessperson as a co-trustee, who administers the trust's business interests alongside the chief trustee.

If a co-trustee or advisor has not been named, the trustee may transfer business management to a carefully selected third-party. The bottom line is that if a business is held in trust and you are the successor trustee, you should contact an Orange County estate planning attorney.

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