Trust Administration and Probate

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For many serving as executors or trustees, the responsibilities they face seem daunting during an already stressful time. The probate or trust administration process occurs during an emotional time for families; and the complex, detailed tasks associated with the process can only add to the stress. By working with executors and trustees, we strive to make the post-death settlement process as easy and stress free as possible by providing clear, detailed guidance on the legal and technical aspects of administering an estate or trust.
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After a family member dies, you’re left with lots of questions, such as:

  • Who inherits their home?
  • What happens if they didn’t have a will?
  • Who’s responsible for paying their debts?
  • Is there any way to avoid the headache of probate? 

If you’re feeling a little lost and confused, Legacy Design Strategies is here for you. Below, we’ll tell you everything you need to know about probate and trust administration.

Wills and Trusts

So, what is probate? Put simply, the court uses probate to validate someone’s will. Even if your loved one didn’t have a will, their estate must go through probate.

If you’re the executor of a will, you might have no idea where to begin. Here’s how probating a will works:

1. First, you’ll have to show your loved one’s will to the probate court. It can be a pain to find the will if you’re unsure where to look. Try starting the search in your loved one’s home office. They may have stashed their will in a safe or desk drawer. If you can’t find it, it’s possible they put the will in a safe deposit box at the bank. You’ll probably need an attorney’s help to open the box.
2. Once you’ve submitted the will, you’ll have to open a bank account for the estate. You’ll pay your loved one’s taxes and debts from this account.
3. Next, you’ll have to tell beneficiaries and creditors about the death. You’ll have to publish a notice in the newspaper, too. We know this seems a little old-fashioned, but it’s the law.
4. Now, you’ll add the value of all assets going through probate. Assets could include cash, cars, bank accounts, and collectibles. Once you’ve tallied the value, give your appraisal to the court.
5. After you’ve paid all taxes and debts, you’ll distribute assets to heirs. Finally, you can close the estate.

Probate Avoidance

Dealing with probate can be a huge headache, so you might wonder whether there’s any way you can avoid it. You may be in luck if your loved one set up an estate plan before they died.

If you know where your loved one banked, ask a banker if they added transfer or pay-on-death designations to their accounts. If they did, you (or the beneficiary they named) could access the money in the accounts without needing to go through probate.
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Last Will and Testament

Did they own a home? If so, check whether they set up a “joint tenancy with rights of survivorship.” That means ownership will go directly to the co-owner without probate.

If they held assets in a revocable trust, those assets will pass to their beneficiaries without going through probate. Irrevocable trusts don’t need to go through probate, either. Even better, you may not have to pay estate taxes on assets in an irrevocable trust.

If your loved one didn’t do any of these things, you probably have no choice but to go through probate. In some states, though, estates may qualify for a simplified version of probate if valued below a certain amount. 

To qualify for simplified probate, the estate must be valued below these amounts:

  • Nebraska: $50,000
  • North Dakota: $50,000
  • Iowa: $100,000

If the estate qualifies, beneficiaries can sign an affidavit to claim the assets. All beneficiaries must agree to the distribution of assets, and in a perfect world, that’s what will happen. 

Sadly, though, it’s common for fights to break out over who inherits what. If your family members can’t agree on how to split things, the probate court will hold a hearing to settle the argument.

Simplified probate laws vary quite a bit in other states. Check your state’s laws to see whether your loved one’s estate is small enough to skip probate.

Trust Administration

If your family member set up a revocable trust, it’s a relief to know that you don’t need to deal with the hassle of probate. However, if they chose you to serve as trustee, you’re not out of the woods just yet.

As trustee, your duties include:

  • Telling the deceased’s family that you will serve as trustee
  • Providing copies of the trust details to beneficiaries
  • Ordering copies of the death certificate
  • Protecting property in the trust from theft and damage
  • Gaining access to your loved one’s bank accounts
  • Notifying life insurance companies, retirement plans, the Social Security Administration, and other organizations that will provide death benefits
  • Paying outstanding taxes and bills with the trust’s assets
  • Closing your loved one’s accounts when you no longer need them

Handing out assets to beneficiaries

The process could take six months or more if you need to liquidate any assets. In a rush? You can speed things up a bit by working with an estate planning lawyer from Legacy Design Strategies.

What if You Don’t Want To Be a Trustee?

Not everyone has the patience to deal with the months-long trust administration process. Nobody can force you to take the job if you don’t want it. 

If you do accept, though, you’re not locked into the role forever. Don’t think you’re cut out to be a trustee anymore? You can quit whenever you want. That doesn’t mean you can just walk away without telling anyone, though.

To relinquish the job, you’ll need to sign a resignation form in front of a notary public. You’ll also have to tell beneficiaries that you’re quitting. If you don’t, they could try to sue you for “breach of fiduciary duty.”

Contact Legacy Design Strategies for Trust Administration and Probate Services

After you’ve lost someone, dealing with probate and trusts is probably the last thing you feel like doing. But with the help of an estate planning lawyer from Legacy Design Strategies, you don’t need to go through it alone. Our attorneys will walk you through everything so you don’t make a single mistake.

To learn more about how we can help with probate and trusts, schedule a no-cost, no-obligation call with our team today.

Probate Step Process

Administering a Revocable Trust after the death of the Trust maker involves several steps.

Close-up of human hands with pens over business documents

Step 1

Confirmation of Trust maker’s Death and Gaining Control of Trust Assets

The first step is to confirm and officially document the death of the Trust maker. This is typically done by acquiring a death certificate. In addition, for a Successor Trustee to be able to access accounts and pay bills, a Tax ID is needed as well as a new Certificate of Trust and a clear understanding by the Successor Trustee of their Fiduciary responsibilities.

Step 2

Notification of Relevant Parties:

Notify relevant parties, such as beneficiaries and heirs, about the Trust maker’s death.

Step 3

Locate and Review Trust Document:

Locate the original Revocable Trust document and review its terms. This document typically designates a successor Trustee and outlines distribution instructions.

Step 4

Initiate Probate Proceedings (if necessary):

Determine if probate proceedings are required based on the assets held outside the trust. If necessary, initiate the probate process.

Step 5

Appraisal of Assets:

Conduct an appraisal of the trust assets to determine their value as of the date of the Trust maker’s death. For financial accounts, each institution will need authorization to release the date of death values on the account. For assets such as real estate or businesses, an appraisal may be required.

Step 6

Successor Trustee Takes Control:

If the Trust maker appointed a successor Trustee, they assume control of the trust. The successor Trustee is responsible for managing and distributing the trust assets according to the terms of the trust document.

Step 7

Notice to Creditors:

Provide notice to creditors, giving them an opportunity to make claims against the trust estate.

Step 8

Payment of Debts and Expenses:

Use trust assets to pay off any outstanding debts, funeral expenses, and administrative costs.

Step 9

Distribution to Beneficiaries:

Following the terms of the trust document, distribute the remaining trust assets to the beneficiaries. This could include specific bequests or a division of assets among multiple beneficiaries. In addition, some trusts will establish trust shares for the beneficiaries. These trust shares are created for a variety of reasons – minor children; special needs beneficiaries; to protect the beneficiary for things like divorce, lawsuits, bankruptcy; to protect the assets from future estate tax, etc.

Step 10

Final Accounting and Documentation:

Prepare a final accounting of the trust administration, detailing all transactions, expenses, and distributions. Keep thorough documentation of the process.

Step 11

Trust Termination:

Once all distributions and administrative tasks are complete, formally terminate the trust.

Step 12

File Final Tax Returns:

File any necessary final tax returns for the trust, including income tax returns and, if applicable, estate tax returns.

Step 13

Distribution of Remaining Documents:

Provide copies of the final trust accounting, distribution documents, and any other relevant paperwork to the beneficiaries.

It's crucial to note that the specifics of trust administration can vary based on state laws, the terms of the trust document, and individual circumstances. Seeking legal advice or consulting with a qualified professional is recommended for accurate guidance tailored to a specific situation.

It is crucial to seek the help of a qualified estate planning attorney to assist through this process. There are many important decisions and tax considerations that have be considered within a short time window.

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Contact Legacy Design Strategies for Your Estate Planning Needs

If you’re ready to make your estate plan, Legacy Design Strategies is here to help. We specialize in estate planning and have years of experience serving clients in Iowa, North Dakota, and Nebraska. If you’d like to make a will or need help choosing a trust, just give us a call.

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Office Locations

Omaha, NE Office

9859 South 168th Avenue,
Omaha, NE 68136

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Minot, ND Office

7 Third Street SE, Suite 202,
Minot, ND 58701

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Iowa Falls, IA Office

320 North Oak Street, PO Box 295,
Iowa Falls, IA 50126

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Some Of The Areas We Serve

LDStrategies
Omaha, NE Office

9859 South 168th Avenue,
Omaha, NE 68136

Minot, ND Office

7 Third Street SE, Suite 202,
Minot, ND 58701

Iowa Falls, IA Office

320 North Oak Street, PO Box 295,
Iowa Falls, IA 50126

IMS - Estate Planning and Elder Law Practice Growth Advisors
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