Many people elect to put some or all of their assets into a trust. Once the original trustee dies, the successor trustee has specific legal obligations to the beneficiaries of the trust. Among these responsibilities is managing the assets of the trust; gathering, assessing value, liquidation and distribution. In addition, trust administration also involves obtaining an EIN number and filing a final tax return for the trust.
Legal Notification Requirements
The trustee has a legal requirement to fulfill the wishes of the grantor in good faith and as quickly as possible. The trustee has to keep all interested parties, including beneficiaries, informed throughout the administration process. However, there are specific legal requirements for notifying potential creditors which can delay the process considerably. Michigan law requires the trustee to allow creditors four months to submit claims for payment against the trust assets.
Dealing with Income and Expenses
A trustee will be required to properly handle dividends and other income received by the trust after the date of death. Remember, the initial valuation of assets is done as of the date of death. Expenses, income and other information including the trustee’s payment, if required, must be reported to the beneficiaries as well as an expected distribution date of assets to beneficiaries.
Trust administration can get very complicated; oftentimes it is helpful for trustees to have a Michigan attorney working alongside them to ensure they are not subjected to complaints about their fiduciary role. If you are a trustee of a trust and need help, contact Kaye Law Office, PLLC at 810-226-0203 or 810-207-5421 for a free consultation, serving Flint, MI and surrounding counties.