In California, there are seven types of trusts. These include the six that go into effect at the time of an individual’s death and comprise life insurance, marital, minor’s, testamentary and special needs trusts. The two types of living trusts in California are the irrevocable and revocable trusts. Estate planning is important for the allocation and proper use of assets and is flexible for all aspects of asset control at all points in a person’s life.
Living trusts, along with the other types of trusts, are managed by a trustee. The trustee manages the trust, and when the grantor dies, the assets are provided to the beneficiaries. Since the living trusts are in effect during the grantor’s lifetime, they, therefore, do not need to be cleared by the courts when the grantor dies or becomes otherwise incapacitated.
A revocable trust enables the grantor to have control of the trust and assets while still alive. Therefore, the grantor may be responsible for estate taxes but also remain in control and can amend the trust at any time. An irrevocable trust names a trustee who becomes the trust’s legal owner. The beneficiaries are then defined, and the grantor can do very little to amend the original agreement. With a trust, asset assignment overrides the beneficiaries that are named on the individual assets, such as in retirement plans and certain bank accounts. Administering the estate is the duty of the trustee and comes with the responsibility of ensuring the grantor’s wishes are followed, including the re-assignment of assets to the beneficiary’s names and proper documents being submitted to the required organizations.
If an individual has been named as a trustee and is required to manage a trust, a trust administrator may be the initial steps that one could take to help navigate the requirements. Finding a professional and experienced trust administration attorney may be beneficial to help ensure that all the proper documents are filed, and the assets are dispersed as needed.