You’ve Got This, Partner!

Are you the Successor Trustee feeling lost on how to adminster a Trust Estate? Check out this handy guide below to help steer you in the direction: 

Step 1: Round Up the Essentials
The first order of business for a successor trustee after the Trustor/Settlor/Grantor rides off into the sunset is to gather up all the necessary papers. This here includes:

• The original trust documents  (the map to the treasure)
• The death certificate (the ticket to the afterlife)
• A list of assets (what’s in the saddlebag)
• Property deeds (proof of land ownership)

Step 2: Know the Timely Trails
As the successor trustee, it’s mighty important to keep an eye on the clock. Missing key deadlines can lead to some dust-ups. Usually, funds moved into the Living Trust skip the probate trail. But if a probate is needed, for some odd reason, according to California Probate Code section 8001, an executor must file the will and a petition for estate administration within 30 days of discovering the decedent has passed.

If the trust becomes irrevocable when the settlor passes, the new successor trustee’s got a 60-day window to notify all beneficiaries and heirs (according to California Probate Code 16061.7). Once they get the word, if they’re gonna contest the terms of the trust, they’ve got 120 days to raise a ruckus about it.

Don’t forget, a Medi-Cal Notice of Death needs to be filed within 90 days, and for real property changes, a Notice of Death of Real Property Owner must be filed within 150 days.

Step 3: Call in the Professionals
Don’t be shy about seeking help from wise folks if you need help selling or transfering property, preparing and filing taxes, appraisals and accounting, or getting legal advice when you need it. Wise professionals can steer you right through the rough patches.

Step 4: Review the Trust Provisions
The trust provisions are like the sheriff’s orders laid down by the Trustor/Settlor/Grantor. They tell you how to manage the trust and what to do with the loot. 

Note: A “spendthrift clause,” keeps the trust’s riches safe from pesky creditors.

Step 5:  Inventory / Appraisal
As the successor trustee, you’ve got to make a detailed list of all trust assets, including:

• Property holdings
• Investments
• Bank accounts
• Artwork
• Vehicles
• Jewelry

Step 6: Manage the Trust Assets
A key part of the trustee’s duty is to wrangle and invest trust assets according to the trust provisions. This may mean opening new bank accounts, consolidating finances, and keeping insurance in check. Remember, you’re acting in the best interests of your beneficiaries, so keep things fair and square.

TIP: Review FDIC insurance provisions 

Step 7: Tackle Estate Debts and Pay the Creditors
Pay the estate debts according to California Probate Code Section 11420.

Step 8: Distribute the Trust Assets
Once all debts, expenses, and taxes are settled, it’s time to distribute the trust assets as per the trust provisions. If the trust lays out periodic payments, make sure to execute those as specified. It may be helpful to have beneficiaries sign a receipt acknowledging  their specific distribution. 

Now saddle up and ride into this trust administration journey with confidence!

Reference: Trust Administration in California - ClearEstate Blog.