One of the primary reasons for trust creation is the fact that when you have created a trust, the assets held within the trust can pass through the trust administration process. The trust administration process is more private, faster, easier, and less costly than the probate process, which Investopedia estimates can take around a year to complete and can cost up to three percent to seven percent of the value of the estate. The trust administration process should also be able to take place outside of court, unless a problem arises. Because of these many benefits, your efforts to create a trust can come as a tremendous relief to your loved ones.
However, when you create a trust so your assets can pass through trust administration, you have to make many important decisions that can shape the outcome of how the process of administering a trust works. One of the most important of those decisions is who you should choose as your trust administrator to put in charge of the process. This decision can make all the difference regarding how effectively the trust can be administered so it is important you make a fully informed choice.
Unsworth LaPlante, PLLC can help. Our trust administration lawyers can assist you in understanding exactly what role the trust administrator will play so you can determine who in your life is best suited to fulfilling this challenging role.
Who Should You Put in Charge of Trust Administration?
The person who you put in charge of trust administration is going to have many responsibilities after you pass away when the trust administration process takes place. Some of the different tasks that the trust administrator will need to do include:
- Providing notice to interested parties that the trust is being administered
- Managing the assets in the trust until those assets can be transferred to new owners
- Taking care of tax issues created by your death and the transfer of assets
- Facilitating the transfer of trust assets to new owners in accordance with the instructions that you have set forth in the trust document.
You want to make sure that the person who you select as trust administrator is competent to take care of all of these tasks. Often, this requires some degree of financial and legal knowledge. For example, your trust administrator needs to understand what the laws are regarding taxes and regarding the official process of transferring assets. Depending upon the types of assets that are held within the trust, your trust administrator may also need to have knowledge of how to manage investments or other assets and ensure that no losses occur due to mismanagement.
You also want to make certain that the individual who you select as trust administrator is a very trustworthy person who will act in the best interest of the trust beneficiaries and who will not try to enrich himself at the expense of those beneficiaries. The trust administrator has a fiduciary duty to act on behalf of the beneficiaries, which is the highest duty one person may owe to another under the law.
If the trust administrator were to act inappropriately, such as by enriching himself, those who lost because of this action could sue for breach of fiduciary duty. However, this adds costs and time and gets the court involved — and avoiding costs, time, and court proceedings are likely some of the key reasons you created the trust in the first place. You don’t want your family to have to cope with this and choosing a trustworthy person means they shouldn’t have to.
Getting Help from Trust Administration Lawyers
The decision of who you should put in charge of administering your trust after you pass on is a very important choice — but it is just one of many important choices that must be made during the trust creation process. You want to ensure that you make a legally valid trust document, that you specify correctly who your heirs or beneficiaries are, and that you do everything correctly during the process of creating a trust. The importance of making the right choices starts from choosing the right type of trust, and continues with every decision that you make.
Unsworth LaPlante, PLLC is here to help with all of these choices. We can advise you on what the law is, what your rights are, how the trust administration process works, and how your decisions will affect your assets and the rights of heirs or beneficiaries. To find out more about how we can help you to choose the right type of trust and ensure that the trust you creates fulfills your objectives and goals, join us for a free seminar. You can also give us a call at (802) 879-7133 or contact us online to get personalized help with your trust creation process. Give us a call today to get started.