Trust Administration

Guidance you can trust

What is Trust Administration?

We represent you as the Trustee to help you carry out your fiduciary duties. Trust Administration is the process and duty of the Trustee to carry out the terms of the Trust and ultimately distribute the assets to the beneficiaries in the manner and timing outlined in the Trust.

It is similar to Probate in many ways but has two distinctive differences. First, the Trust Administration process is not supervised by the Probate Court and is entirely handled by the Attorney and the client in private. Second, in Probate, assets are distributed outright to the beneficiaries at the end of the process, whereas in Trust Administration, the assets may be held back in further Trust to be paid out in the timing and manner specified in the Trust.

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480-515-3716

Types of Trust We Administer

• Revocable Trust – death of a spouse
• Revocable Trust - death of both spouses
• Special Needs Trust
• Children’s and Grandchildren’s Trusts
• Dynasty Trusts (Generation Skipping)
• Spousal Lifetime Access Trusts
• Charitable Remainder Trusts

How Trust Administration is similar to Probate:

1. The Trustee’s primary function is to protect and safeguard all assets.
2. The Trustee inventories and appraises all assets to determine “fair market value” on the date of death.
   1. These values are used to establish a new “stepped-up cost basis” for capital gain purposes.
   2. They are also used to determine whether or not the Federal Estate Tax applies.
3. The Trustee deals with all known creditors and publishes notice in a newspaper to any potential “unknown creditors.”
4. Settle IRS issues:
   • File decedent’s final income tax return
   • Assist in establishing “stepped up cost basis”
   • File Estate Tax Return if necessary
5. Assets are sold and converted to cash or distributed in kind to the beneficiary as the Trust specifies.
6. Beneficiaries are provided with an Annual Accounting of all activities of the Trustee.
7. The Trustee is entitled to reasonable compensation.
8. The Trustee has the power to invest and reinvest the Trust assets to maximize returns and, at the same time, safeguard the assets for the beneficiaries.

How is Trust Administration Different from Probate?

1. In Probate, assets are distributed outright to the beneficiaries when the Probate process ends. In contrast, during Trust Administration, assets are often held in Trust for longer periods—typically until the beneficiaries reach certain age milestones. The timing of distributions is dictated by the terms of the Trust. For example, children may receive distributions in stages: one-third at age 25, one-third at age 30, and one-third at age 35.
2. The Trustee may have “discretionary powers” to make distributions for the beneficiary’s health, education, support, and maintenance. Both the timing and the amount of these distributions are guided by the Trust’s instructions.
3. Because Trust assets are often held over time, the Trustee has a legal duty to invest those assets in a reasonable and prudent manner.
4. The biggest advantages of a Trust over a Will include:
   1. Avoiding Probate
   2. Controlling both the timing and the amount of distributions to beneficiaries
5. Trusts provide ongoing safeguards and asset management until beneficiaries reach designated ages, offering an added layer of protection and oversight.

DWL Experience

Matt Dana has handled literally thousands of trust administrations in his 40+ years of experience. Our biggest advantage is the number of lawyers and paralegals we have. Many probate law firms operate as a “one-man show,” which means it takes these firms much longer to assist you and answer your questions. Additionally, their fees tend to be higher because they do not delegate the work to paralegals.

FAQ