There are many different estate planning tools, each one uniquely suited to perform a certain task. Some estate plans use every tool in the box while others only require one or two. A trust may be the most versatile tool of them all.
It is important to know how this tool can be used, especially after you are gone and someone else picks it up in your stead. With a well-crafted trust, written by an experienced and knowledgeable Washington estate planning attorney, trust administration can be a fairly simple task.
For more than 30 years, Attorney Robert Taylor-Manning has helped clients express their wishes through strategic estate plans and has helped trustees and beneficiaries understand how they are administered. The Northwest Elder Law Center proudly serves clients in Kennewick, Pasco, Richland, and Walla Walla, Washington, as well as Portland, Oregon, and the surrounding areas.
The person who creates a trust is typically referred to as the “grantor.” The grantor often administers the trust as the named trustee until they become incapacitated or die. When either occurs, the person the grantor named as the successor trustee will begin to manage the assets of the trust and administer the distribution of assets to any named beneficiaries as directed by the trust document.
While everyone should have a will, there are two major benefits to also having a trust as part of your estate plan. The first advantage is saving time and money. If all the grantor’s assets are included in the trust, the estate will not have to go through probate upon the grantor’s death. Probate can be a lengthy process that often takes at least six months in Washington and at least four months in Oregon to complete. It can take considerably longer if a will is challenged. Attorney’s fees for Washington probate average around $4,000 and in Oregon they can range from $3,000-$5,000 or more. There are also filing fees and other costs associated with the probate process.
The second benefit is privacy. A trust is not subject to probate, which is a public judicial process. Therefore, the decedent’s assets and beneficiaries can remain private as the estate is dealt with and assets are distributed to beneficiaries.
The trustee is the person who manages the trust before distributing the assets according to the grantor’s wishes. Grantors often name themselves as the primary trustee and name someone else as a successor trustee. The successor trustee takes over the management of the trust upon the incapacitation or death of the grantor.
The successor trustee has six major responsibilities in that role. Those responsibilities are as follows:
To identify beneficiaries of the trust by knowing who the beneficiaries are and how to locate them.
To pay administrative expenses, including the grantor’s funeral and burial costs, insurance premiums for assets, asset appraisal costs, and fees for accountants and attorneys for services rendered on behalf of the trust.
To address debt, including mortgages, loans, credit cards, and medical debt.
To distribute assets according to the provisions of the trust by making sure the grantor’s wishes are carried out as specified.
To prepare the trust’s taxes every year until all assets have been distributed and there are no more assets belonging to the trust.
To create a reserve fund to cover things like maintenance and repair of trust assets. For example, if any property needs to be maintained, money from the reserve fund would pay someone to maintain it, so long as that property is an asset of the trust.
If you choose to use a trust as an estate planning tool, you should understand how it will be administered when you are no longer able to do so. Your successor trustee and your beneficiaries should also be aware of what happens during the process of trust administration.
An experienced trust administration attorney can not only ensure that your trust clearly outlines your exact wishes and preserves your legacy, but your attorney can also provide guidance that will ensure your trust complies with all of the appropriate state laws. If necessary, your attorney can also help you create a document that will be easily administered when the time arrives.
So don’t wait. If you or someone you know is considering a trust in Kennewick, Pasco, Richland, or Walla Walla, Washington, or in the Portland, Oregon area, call or reach out to the Northwest Elder Law Center today for experienced legal counsel and guidance.
If you are considering a trust or other estate planning documents, attorney Robert Taylor-Manning can help. The Northwest Elder Law Center has been helping clients with trust administration for more than three decades. If you are ready to discuss a trust, call or reach out today to schedule a free consultation. It is never too early or too late to begin planning for your future — so call today.