I have an Estate Plan—What do My Successor Trustees or Personal Representatives Actually Do?

The Successor Trustee

If you have completed your estate plan using a living trust, you likely have named successor trustees of your trust.   A trustee is a person or trust company you select and name in your trust.  With a living trust that you create, you are the Grantor of the trust and you are generally the first trustee in charge of your own assets held in your trust.  As the Grantor, you can make changes to your trust, including moving assets to and from the trust, changing its beneficiaries and changing successor trustees.

The Successor Trustee During Incapacity

A successor trustee is needed if you experience incapacity, either short-term or long-term, and again when you pass away.  During your incapacity, your successor trustee manages the trust assets, takes care of your needs and the needs of anyone else who is dependent upon you for support.  If you are no longer able to manage your financial affairs, because of cognitive impairment or another injury, your successor trustee will step in and handle the trust for you.  A successor trustee is a fiduciary for you over the trust and its property, and a successor trustee cannot make changes to your trust.  A fiduciary is legally required to act in your best interest when serving as a successor trustee.

The Successor Trustee After Your Death

Upon your death, the successor trustee will follow your trust instructions and distribute the assets held in the trust to your named beneficiaries the way you have chosen.  When assets are held in a living trust correctly, you may avoid probate when you pass away.  Your successor trustee will close down the trust without the burden of probate.  This means that court supervision is typically not required to settle your trust at your death.

The Personal Representative

If you have completed your estate plan using a Last Will & Testament, you have named a personal representative (executor) to settle your probate estate after you pass away.

A personal representative is also a fiduciary, and although named by you in your Last Will & Testament, must be appointed by the court in the probate process.  A probate petition must be filed with the court for your personal representative to be appointed.  The appointment authorizes your personal representative to gather the estate’s assets, sell assets, pay creditors and open an estate bank account.

Depending on the state law, a personal representative may work under an unsupervised probate or with court supervision.  The personal representative is ultimately responsible for distributing the estate assets to your heirs in accordance with the terms of the Last Will & Testament.  If there is no Last Will & Testament, then your personal representative will distribute your assets in accordance with state laws.  Your personal representative distributes estate assets only after debts, taxes and administration expenses are paid.

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