Probate and Trust Administration
When a person dies owning assets, it is likely that a probate proceeding or a trust administration will be necessary in order to transfer ownership of the assets. The people who will inherit the assets are referred to as the decedent’s “heirs” when there is no will or trust, “devisees” when there is a will, and “beneficiaries” when there is a trust.
Probate is a formal court proceeding by which the probate court oversees the transfer of the decedent’s assets to the decedent’s heirs or devisees. If the decedent had a will, the will is filed with the probate court and the assets transfer according to the terms of the will. If the decedent did not have a will, the assets transfer to the decedent’s heirs under the laws of intestate succession. There are a number of statutory requirements and deadlines in a probate proceeding and the laws are frequently changing. There is also a waiting period before distributions can be made to those entitled to receive the decedent’s assets. For these reasons, a probate proceeding can be more lengthy and costly than a trust administration. The records filed in a probate proceeding are public records.
With a properly funded revocable living trust, the decedent’s assets are owned by the trustees of the trust, and upon death, the successor trustee can transfer ownership of the assets to the beneficiaries without the necessity of probate. This is called a trust administration and it is typically faster and less expensive than a probate proceeding. Because documents are not filed in court, a trust administration is private. Your successor trustee is the person, or in some cases financial institution, who will take over the duties of trustee upon the trustee’s death or incapacity, and who will manage those assets and distribute them to the beneficiaries according to the terms of the trust. It is therefore very important to put great care into choosing your successor trustee.
Information on this website is general information and is not to be considered legal advice. It is important to discuss your specific situation with an attorney who can advise you accordingly.