Articles Posted in Administration of trusts and probate estates

Let’s Subtract the Money Johnny Got From His Share of the Estate

TYPICAL SITUATION

A father dies without a will leaving an estate of $100,000.  Under the laws of intestate succession which apply because there is no will, his 4 children are to receive equal shares of the estate which would be $25,000 each. However, during the 10 years leading up to his death, the father had transferred $20,000 cash in total to his son Johnny thus creating a pre-death transfer.   There was no documentation stating whether the $20,000 was a gift or a loan or an advancement against Johnny share of the father’s estate.

WHAT IS IN THE ESTATE AND HOW THE PERSONAL REPRESENTATIVE FIND AND MANAGE IT?

PROBATE ESTATE ADMINISTRATION

Probate Asset Inventory & Collecting – If a person passes away leaving money or property there may need to be a probate court administration of the estate. If there is a living trust and all of the deceased person’s assets have been placed into the living trust prior to death, there is no need for a probate court administration and the procedures discussed in this article would not be applicable to a living trust situation. The point of a probate court administration is to get somebody appointed as the administrator or executor of the estate (also known as the personal representative) who has authority of the court to handle to inventory and handle the money and property and accounts of the deceased person. Upon appointment by the court, the administrator will obtain a form signed by the court entitled letters of administration. The personal representative will then take the letters of administration over to all banking and securities institutions and have the accounts transferred out of the name of the deceased and into the name of the personal representative.

CAN A DECEASED PERSON’S ESTATE ESCAPE PAYING DEBTS & TAXES?

PROBATE ESTATE ADMINISTRATION

Can we avoid paying debts?If a person passes away leaving money or property there may need to be a probate court administration of the estate. If there is a living trust and all of the deceased person’s assets have been placed into the living trust prior to death, there is no need for a probate court administration and the procedures discussed in this article would not be applicable to a living trust situation. The point of a probate court administration is to get somebody appointed as the administrator or executor of the estate (also known as the personal representative) who has authority of the court to handle the money and property and accounts of the deceased person. The personal representative is also responsible for paying the debts and taxes before the estate is distributed out to the heirs.

Can I give everything to the “love of my life” and keep it secret?

NO DISCLOSURE TO OMITTED HEIRS?

Up until 1997 a person could legally change his or her estate plan and the people previously benefited did not have any legal way to find out what the situation was. Before the law was changed to require disclosure as it is now, the state legislature committee reviewing the proposed legislation was presented with a case of a 90-year-old man who met the “love of his life” on a bar stool and married her three months later.

How Does the Successor Trustee Handle the Bills and Debts of the Deceased Trustor?

LIVING TRUST ADMINISTRATION

Successor Trustee paying trustor debtsIf there is a living trust and all of the deceased person’s assets have been placed into the living trust prior to death, there is no need for a probate court administration. Creditor Rights? For probates, there are specific court-supervised formal steps required to notify creditors and for approval and rejection of creditor’s claims. The situation involving a trust is much less formal and the laws differ somewhat. The person who administers a living trust following the death of the trustors (the persons who created the trust) is known as the successor trustee.

WHY DID THE TRUSTEE PAY ALL THAT MONEY TO HIMSELF?

WHAT ARE TRUSTEE FEES?

A trust is typically established by a document known as a declaration of trust will which is a document with instructions for how the trust assets are to be handled. The declaration of trust also identifies the trust creators, known as trustors, the beneficiaries who will be receiving money and benefits out of the trust and the trustee. The trustee is the person or institution responsible for administering the trust, writing the checks, paying the bills, etc. The trustees fees are what is paid to the trustee for doing the work of administering the trust.

Can I Really Spend All My Inheritance Money, or Does Uncle Same Get a Portion?

DOESN’T MATTER IF IT COMES FROM AN ESTATE OR TRUST

taxableIs My Inheritance Taxable – Your inheritance of money or property may come from the estate of a deceased person or from a trust established previously.  These types of things are generally referred to as “bequests” or “gifts” as far as tax law is concerned.  People receiving bequests or gifts are referred to as “beneficiaries”.

How did that kid get so much money to blow!

18 is the age of majority

When a child turns 18 years he or she is considered to be an adult under California law. In legal terms, children under age 18 are called “minors” and when they reach age 18 they are called “adults”. Minors and adults are treated differently as far as inheritance rights are concerned. Minors still have rights to inherit but any inheritance which comes to them is subject to certain legal controls because the law presumes that minors are not capable of handling money or property as well as adults.

How Do You Figure Out Who Gets What? – Inheritance with Simultaneous Deaths

LEGAL BACKGROUND: 2 WAYS TO INHERIT

Under California law a person can inherit money or property (1) as a result of being named in a legal document such as a will or (2) inheritance can occur because a person is related by blood or marriage to the deceased if there is no will.

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