Orange County Estate Planning Lawyer BlogTRUSTS – ACCOUNTING-
PERSONAL PROPERTY PROCEDURES
By: David L. Crockett, Attorney, CPA
Articles Posted in Trust & Probate Litigation
16 PITFALLS IN TRUST ADMINISTRATION
GENERIC OUTLINE OF BASIC TRUST ADMINISTRATION STEPS:
(Each step of administration can create serious pitfalls and problems if ignored)
1. Study of the trust documents to determine specific instructions i.e. what to do on death of first or second spouse as the case may be.
Protected: Trusts-duty to account to beneficiaries & types of accounting
TRUSTS – DUTY TO ACCOUNT TO BENEFICIARIES & TYPES OF ACCOUNTING
By: David L. Crockett, Attorney, CPA
Types of Accounting: Trust accounting may be (1) Informal; (2) Formal (non-court) according to Probate Code §16063 format; or (3) Court accounting according to Probate Code §1060 et. seq. requirements. The trust accounting is to be prepared by the Trustee and/or under his/her authorization.
Trust accounting lawsuit/petition procedures
TRUST ACCOUNTING LAWSUIT/PETITION PROCEDURES
By: David L. Crockett, Attorney, CPA
Trust terminology basics. A trust is created by a written document known as a declaration of trust, and is then funded by transfer of money into trust bank accounts and/or deeding or transferring of properties to the trust. The creator of the trust is known as the “Trustor” or the “Settlor.” Trusts are usually prepared by attorneys because each trust is custom for the situation and there are many types of trusts. The persons who are to receive money and property out of the trust are known as the “Beneficiaries. The person or institution that takes care of the money and property of the trust is the “trustee”. The trustee is bound by law to follow the directions contained in the declaration of trust. Trusts are not supervised by the court system and are not registered with the state government upon formation. Trusts are essentially private contracts between the trustors, the trustees and the beneficiaries. There are laws written into the California probate code that control the governance of trust matters.
Trustee Fees
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.
Probate Court Litigation
Orange County Probate Court Litigation Lawyer
YOU CAN FILE LAWSUITS OVER PROBATE ESTATE MATTERS
PROBATE COURT SYSTEM
Getting Money Out of a Trust
My Sister is the Trustee and She Refuses to Pay My Share
Trust terminology basics
A trust is created by a written document known as a declaration of trust, and is then funded by transfer of money into trust bank accounts and/or deeding or transferring of properties to the trust. The creator of the trust is known as the “Trustor” or the “Settlor.” Trusts are usually prepared by attorneys because each trust is custom for the situation and there are many types of trusts. The persons who are to receive money and property out of the trust are known as the “Beneficiaries.” The person or institution that takes care of the money and property of the trust is the “Trustee”. The trustee is bound by law to follow the directions contained in the declaration of trust.
Wills – Presumption of Fraud or Undue Influence Where Beneficiary is a Fiduciary or Care Giver
Wills benefiting the attorney or caregiver are suspect
Abuses in formation of wills and trusts
In California over the last few decades there have been some situations whereby attorneys or caregivers have had wills or trusts prepared that benefit them. There was a famous case of a 95-year-old lady whose will left the bulk of her fortune to the people taking care of her. It turns out that the people taking care of her, known as “care custodians” had the will prepared under suspicious circumstances such that the 95-year-old lady probably didn’t know what she was signing. This and other similar situations led to recent legislation to correct abuses.
Wills – No Contest Clauses
Cut out the heirs who challenge the will using No Contest Clauses
Challenges can occur
If a will or a trust does not make an equal division of the estate then an unhappy heir might want to make a challenge. The law does not require you to equally divide your estate equally amongst your children or to give anything to them for that matter. Most children or in some instances brothers or sisters where there are no children feel that they are entitled to an inheritance. Not everybody understands or believes that a person making a will or trust can leave his or her assets to anyone. This has led to litigation challenging the provisions of the will or trust.
