December 14, 2021
Michigan Trust Attorney: What is the Function of a Successor Trustee?
When creating a trust to protect your family, the most crucial choice you will need to make is who will be named as the successor trustee. This is the person who will fulfill the trustee’s duties when that person is incapacitated or passes away. This person has a large job, and you want to be sure you trust this person with your personal and financial health as they will be executing your final wishes.
When the grantor is alive, there are not many obligations that the successor trustee has. However, it is essential the person is aware of being named the successor trustee and that a conversation is had regarding the administration of the trust. If the trust maker becomes incapacitated medically or otherwise, the successor trustee steps in to ensure the grantor’s living expenses and financial obligations are taken care of appropriately. These include paying bills, the mortgage, and even buying groceries.
After the grantor passes away, the job of the successor trustee begins in earnest.
The tasks the successor trustee will deal with can be broken into two groups, personal and financial. Here is an overview of the most common responsibilities.
- Notify next of kin, named beneficiaries, and all other people or organizations designated as a beneficiary in the trust documents. The process could be state-specific, and organizations named in the trust might have specific procedures that need to be followed.
- Order multiple copies of the death certificate by asking the funeral home to assist you. These will be needed for many financial and personal tasks throughout the process of closing the trust.
- All property not accounted for in the trust should be distributed to the beneficiaries or sold with the funds going to the trust.
- Help to distribute the personal property as listed in the trust. But remember, only the items listed on the Schedule C document can be allocated until the rest of the estate is settled.
- Liquidate assets if needed. Then distribute the money or property to the beneficiaries.
- File state and federal taxes for the person.
- Communicate with the beneficiaries consistently and keep them up to date with the progress of the case.
- Locating the trust documents and reviewing the distribution as stated in the trust. The assets not placed in the trust may need to go through the probate process, and filing for this as soon as possible is advised.
- If there is not already a bank account created in the name of the trust, one needs to be opened. A strict accounting of money in and out of this account is vital.
- Notify financial institutions, billable accounts, and all debtors of the passing. Create a list of every single account, including the account numbers, the amount owed, and any security deposit boxes there may be.
- Once financial accounts like retirement accounts and life insurance companies have been contacted, the named beneficiaries should swiftly receive the monies in those accounts.
- Secure the personal and real estate property and have everything appraised.
- Ensure all real estate property stays maintained with bills and utilities paid.
- Contact the credit bureaus to report the death and cancel credit cards.
- Ensure there are enough finances to pay off all outstanding debt and bills.
- Close the trust. Once debts are paid, and property is either transferred or sold, the trust can then distribute the funds left to the beneficiaries.
I could go on and on with a list of tasks that need to be done. The person you pick will need to work closely with an estate planning attorney to complete the job to the benefit of the trust. Ensuring your successor trustee has a connection with your Michigan trust attorney is vital.
If you are thinking about creating a trust or want to review your trust to ensure it still protects you to the fullest, call 844.885.4200. The estate planning attorneys at Castle Wealth Group are here to help you create the right estate plan for you!
About Castle Wealth Group
Contact Castle Wealth Group for all your estate planning needs. We build a perfect strategy for your retirement, including income planning, investment planning, tax planning, health care planning, and legacy planning. Visit our website or call us at 844.885.4200 or email us for your financial advice.
Join our Weekly Wisdom Webinars
Estate Attorney and Advisor Chris Berry of Castle Wealth Group answers questions on retirement and estate planning every Wednesday at 1pm www.wisdomwebinar.com to register or give our office a call at 844-885-4200.