A revocable living trust is a valuable estate planning tool for protecting assets, avoiding probate and minimizing certain tax ramifications. A well-funded trust with clear instructions can be a blessing to heirs who may then receive their inheritances without having to wait the months or years probate may take. Often, the key to a smooth trust administration is choosing a competent successor trustee who will handle the distribution of its assets or their maintenance after the trust maker dies.
Once the trust maker passes away, the successor trustee has some important tasks to complete. Ideally, the trust maker has consulted with his or her successor so the following steps will be straightforward and relatively easy to accomplish soon after the successor takes over:
- Gathering documentation for insurance policies, investments, retirement accounts and other assets funded to the trust
- Locating the trust’s real assets and ensuring their protection
- Seeking appraisals of assets based on the date of the trust maker’s death
- Paying off any creditors, expenses and taxes related to the trust
- Distributing the assets in the trust according to the instructions the trust maker has left
If the trust names a minor or other dependent as a beneficiary, the successor trustee may have the task of managing the asset and distributing as the trust instructs to the child’s guardian or to the child when he or she reaches a certain age. In such cases, the trustee will be responsible for investing and managing the assets so they will continue to provide for the beneficiaries throughout the years.
