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Trust and Estate Administration FAQs

A trust is a fiduciary agreement and is part of a larger estate plan. A trust is often used as a tool to minimize taxes and protect assets. If the creator goes bankrupt, creditors cannot make claims on the assets placed in the trust.

Probate is an expensive process. If your assets go through probate, your personal information will be made public. A properly established trust allows you to avoid probate. If you become physically or mentally incapacitated, your trust can help your family avoid conservatorship.

Estate administration is the process of collecting and managing an estate while paying off any outstanding debts or taxes, and distributing the remainder to the beneficiaries.

To help you better understand trusts and the estate administration process, we have compiled a list of some trust and estate administration FAQs.

Trust FAQs

How Does a Trust Differ From a Will?

Both trusts and wills are estate planning tools. A will is a legal document that states the manner in which the creator’s assets are to be distributed. On the other hand, a trust allows a third party to hold and manage assets owned by the estate owner.

The major difference between a trust and a will is that while a will becomes effective when the creator passes away, trust comes into effect immediately after the assets are transferred to the trustee. A will goes through probate, whereas a trust does not.

Trust administration in Santa Rosa involves gathering and taking control of trust assets, implementing business succession plans, and filing income tax returns.

What Are the Pros and Cons of a Trust?

Some benefits of trusts include:

  • Living trusts ensure privacy
  • Limited liability
  • Trust income is usually taxed as income of an individual

Some downsides of trusts include:

  • Establishing and maintaining trust is expensive
  • Creators can encounter problems when borrowing
  • Trust deeds can restrict trustees’ powers

Estate Administration FAQs

What Are Some Estate Administration Costs?

Estate administration costs include:

  • Accounting and lawyers’ fees
  • Filing and processing fees
  • Administrative costs, including fees for notices and bonds

What Does an Estate Administrator Do?

An estate administrator or executor is appointed by a probate court when an estate owner passes away without appointing an executor. Some duties of an estate administrator are:

  • Sending out all appropriate notices to every heir or next of kin
  • Filing insurance claims
  • Re-titling property in the name of the estate
  • Preparing and filing any tax returns

Johnston Thomas Law needs no introduction. We are a leading law firm when it comes to trust administration in Santa Rosa. We are committed to protecting our client’s interests and assets. To make an appointment, contact our office at (707) 545-6542.

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