Estate Planning

Wrapping Up a Trust.

By Jennifer Sawday

While trust administration is largely removed from any court oversight and is managed privately by the successor trustee(s), it is a good idea to formally wrap up a trust (any trust including a revocable living trust) where the settlor(s) (or creators) of the trust have died.

A Trust Distribution Agreement is designed to protect both the successor trustee(s) and beneficiaries of the trust after the settlor(s) has/have died.  This document is a formal agreement prepared by the successor trustee(s) that covers the following aspects of trust administration:

• Distribution Provisions (as understood by the parties and governed by the trust)
• Date of Distribution
• Proposed Distribution
• Funding Dates
• Preliminary Distributions (if any)
• Consent to Distribution by Beneficiaries
• Waiver of Notice (if appropriate)
• Waiver of Accounting (if appropriate)
• Reserve Amounts (if appropriate)

It should also include language for governing law and appropriate indemnification clauses. Once such an agreement is prepared and agreed upon by the parties, the successor trustee(s) can finalize the trust and distribute the trust assets.

Consult with your attorney about trust administration and preparing a Trust Distribution Agreement to wrap up the trust. It is one of those things that will give you a peace of mind when administering a trust as a successor trustee.

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Estate Planning, Probate and Trusts involve complex areas of law. Individual circumstances must be considered before any advice can be given.  The general information above is not to be construed as legal advice, which can only be given after consideration of the unique facts of each matter. Please seek the advice or counsel of your attorney, financial advisor or CPA as it may be appropriate.

Full post as published by Estate Planning Practice Blog on March 13, 2008 (boomark / email).