What are My Duties as a Trustee of a Trust?
Video Summary
What are the duties of a trustee named in a trust? The most common scenario we see is whenever someone comes in and they set up a trust during their lifetime, which is called a living trust or a revocable trust, where they name themselves, and then they provide who their assets are going to be distributed to under the provisions of the trust, and name a successor trustee.
During the person’s lifetime they can pretty well treat the trust assets any way they want to since it’s for their benefit. Upon their death, the revocable trust becomes irrevocable, and the successor trustee then assumes the responsibilities, and they are to send a copy of the trust to all the beneficiaries, whether they be income beneficiaries, whether they like the beneficiaries or not, but they’re to send a copy of the trust to everyone.
They’re also to file a notice of trust in the public records. After having sent out the trust and recorded the notice of trust with the probate court, then they go about obtaining an inventory of all the assets that are in the trust. Once that’s accomplished, they need to obtain a federal identification number so that an accounting or a tax return can be filed by them so that they don’t have to pay any taxes.
Now during the lifetime of someone who sets up a trust for their own benefit, they’re not required to get a federal identification number, and can use their Social Security number. However, upon their death, the successor trustee has to have a federal identification number in order to file a fiduciary tax return, and that would govern how the people are to pay taxes on the money that they receive or the income that they receive from the trust, and that would be something that the successor trustee would want to consult with the attorney about, as far as the administration of the trust and the distribution of the assets, in particular, if there is homestead property involved, if there’s property in the name of the decedent, and we need to go through a probate proceeding in order to obtain those assets to be titled in the trust, and then the trustee must be very careful in reviewing the provisions of the trust to see what they’re directed to do. If it says simply, “Distribute out at my death as soon as possible to the named beneficiaries,” well, you need to make sure that the creditors are paid, and then have an accounting of everyone, as far as the inventory, to make distribution, and then file a fiduciary tax return with the Internal Revenue Service so that the income can be accounted for, and you can be compensated as trustee in order to be able to fulfill your duties as a trustee.
If this is a continuing trust, meaning that you must pay the income to a beneficiary for an extended period of time, then you need to consult with an attorney concerning your investment responsibilities and financial responsibilities, and that you’re governed under the Prudent Investor Act. There’s a whole trust code, a bunch of rules and laws as to what you’re obligated to do, and I would urge you to consult with an attorney about a trust administration.
If you have any questions, give me a call at 727-847-2288.
Thank you.
What Are The Rights of a Spouse in a Home When the Spouse Dies?
Video Summary
What are the rights of the spouse in a home when their spouse dies? We first have to look at how title is held to the property. If it is held in their joint names as husband and wife, then the property automatically goes to the spouse, and all that is needed is to record a death certificate.
If the title is just held in the spouse’s name alone who passes away, then it is considered homestead property, and is controlled by the Florida Constitution and the laws of the State of Florida. And if you’re survived by a spouse and minor child, then the spouse receives a life estate and a remainder interest vest in the children. You cannot devise it or leave it in your will to anyone else. The spouse does have an election to make, and they can elect to take a half interest in the property, but they must file that election within, I believe, six months of the date of death of the spouse. So if you do lose your spouse, you need to contact an attorney right away to discuss your rights in the property.
Now if your spouse leaves a will, and the deceased spouse is not survived by minor children, then the decedent can leave in his will the property to his spouse. That is the only person he can leave it to. He cannot provide for life estate or anyone, anything else, and so it is an improper devise to leave it to anyone other than your spouse, and then it would be controlled by law, which would mean that the spouse would have a life estate or elect to take a 50 percent interest in it, and the other remainder interest would pass to the adult children of the decedent.
So it’s a little bit complicated as far as homestead is concerned; misunderstood by a lot of attorneys. So if you lose your spouse and he owns the property in his name alone, I urge you to give me a call; set up an appointment, and let’s review the situation right away.
My phone number is 727-847-2288.
How Does a Lady Bird Deed Help My Heirs Avoid Probate?
Video Summary
How does a lady bird deed help my heirs avoid probate?
Well first let’s define what a lady bird deed is. That is a name that an author of a treatise gave to a life estate deed. A life estate deed means that you convey your property to your children or to anyone. However, you reserve to yourself a life estate, meaning that you own the property, or you get to use the property during your lifetime.
Now what is known as a lady bird deed has additional powers besides being able to use the property during your lifetime. Those powers include, which are reserved to you with your life estate is the ability to sell the property without the joinder of these remaindermen. So that is the definition of a lady bird deed when we’re talking about it.
So how does it avoid any kind of probate when a person passes away? Well, you signed the deed and you conveyed it to whomever, your children or your heirs and reserved a life estate. And you have certain rights to convey or transfer the property during your lifetime. But if you do not sell or convey it during your lifetime upon your death all they need is a death certificate and they will own the property, “they” being whomever you have conveyed the property to. And the deed, they will own it, and all they need to do is record the death certificate and they will automatically own the property.
So that’s how your heirs will avoid any probate proceeding if you sign a lady bird deed conveying the property to them during your lifetime.
If you would like to discuss this further well give me a call at 727-847-2288. Thank you.