The average person probably does not have much experience handling trusts, and may have plenty of questions about what it means to be a trustee. People may have certain expectations about the way in which living trusts operate after a person passes on. The majority of people are aware that one of the biggest benefits of establishing a living trust is that it can significantly reduce probate, prevent delays, and lower the fees associated with distributing assets.
Some people may not realize that even though a living trust avoids probate, there are plenty of tasks that still have to be completed. Legal documents must be prepared, tax returns filed, and other matters must be dealt with regarding the assets.
Q: Why are living trusts so popular?
A: Living trusts are a popular choice for many, especially those who live in areas where real estate prices have drastically increased. Higher real estate costs lead to bigger estates, and potentially steep probate fees. In states where it is much cheaper to buy real estate, living trusts may be less prevalent.
Living trusts avoid the probate process, as long as assets were transferred into it before the person passed on. If no living trust was created, then the court mandates taking over the estate and handling the person’s assets after death. In general, not many people appeal to the idea of the government being in charge of their finances and property.
Q: So what is the key difference between living trusts and others?
A: There are several types of trusts a person may create, including revocable, irrevocable, asset protection, charitable, constructive, special needs, totten, spendthrift, and tax-by pass. The main difference between living trusts and others, is that everything is handled through private matters and no court supervision. As a result, the process of distributing the estate is quicker and less expensive.
Q: Is there any situation in which asking for court assistance can be helpful?
A: A trustee of the living trust may need insight when they are not sure about what to do regarding a trust dispute or responsibility. The trustee can petition to the court for directions on how to handle a situation or go about completing a task. If this happens, the beneficiaries are sent notices for the hearing and receive a copy of the petition for the matter. The issue or topic will then be addressed in court, and beneficiaries have the chance to show up and express their preferences.
Q: Is it required that I get help from an attorney if I am the trustee?
A: It is not uncommon for trustees to turn to an attorney for guidance as they manage the trust assets. The average person may not know where to begin, and don’t want to make a mistake. Being a trustee for another person’s life legacy is a major responsibility. Those who want support along the way can consult with a trust attorney O’Fallon, MO offers in their town who is knowledgeable about trusts and estate-related legalities.
Thank you to our friends and contributors at Legacy Law Missouri for their insight into estate planning and the benefits of living trusts.