(513) 916-1600Navigating the Complexities of Trust Administration
The process of trust administration often arises when a spouse or parent, who established the trust, passes away. This intricate and time-consuming process can be challenging for any trustee. To ensure a smooth administration and compliance with estate tax laws, it is advisable to work with an experienced trust administration attorney at Krugler Law.
Understanding the Stages of Trust Administration
Trust administration involves several distinct stages that must be followed diligently. As a trustee, you are responsible for handling the trust and distributing assets as outlined by the trust creator. These stages include:
1. Taking Inventory of the Assets: Identify all assets held in the trust, determine ownership and obtain date-of-death valuations for each asset. An accurate valuation is crucial for estate and income tax implications.
2. Determining the Estate Tax: While the federal estate tax exemption allows for passing up to $5 million (temporarily doubled from 2018 to 2025) without incurring taxes, individual states may have lower limits. The team at Krugler Law will help identify which assets fall within the trust, which require probate, and which are subject to estate tax.
3. Dividing the Trust Assets: For couples with A-B or A-B-C Trusts incorporating tax and estate planning, the deceased spouse’s assets remain in the trust for use by the surviving spouse while remaining protected from potential estate taxes.
4. Filing IRS Form 706: This form must be submitted within nine months of the recorded date of death, in addition to Form 1040 for the year of death and Form 1041 for the subsequent trust years.
5. Distributing Assets to Beneficiaries: As the trustee, it is essential to follow the trustor’s instructions and distribute assets to named beneficiaries after settling debts and tax payments.
The Advantages of Trust Administration
Choosing trust administration as your estate planning method offers numerous benefits, including:
1. Avoiding Probate: Trust administration bypasses the lengthy and costly probate process, providing beneficiaries with quicker access to assets.
2. Keeping Family Out of Court: Trusts prevent family members from enduring court appearances and disputes over wills, minimizing stress during difficult times.
3. Protecting Privacy: Unlike probate, trust administration safeguards your family’s privacy, shielding financial information from public records.
Helpful Trust Administration & Probate Definitions
Contact a Trust Administration Attorney Today
Creating a trust is a powerful way to safeguard your assets and ensure they are distributed according to your wishes. Trust administration and probate involve intricate tax laws that require expert guidance. Contact Krugler Law today to schedule a consultation with an experienced member of our trust administration team, and secure your family’s future.
