Livonia Trust Administration Attorney
Trust Administration After Death
When a loved one passes away, managing their trust requires a careful, legally compliant approach. At the Law Office of Shannon DeWall, we assist Livonia clients in fulfilling these responsibilities while respecting the deceased’s wishes. Our team provides guidance through each step of the process, helping to navigate Michigan’s trust laws and easing administrative burdens on trustees.
Key Roles in Trust Administration
In administering a trust, three main parties are involved:
- Settlor: The individual who created the trust.
- Trustee: The person appointed to manage and execute the trust’s terms.
- Beneficiary: The person(s) who will receive assets from the trust.
Each role has specific legal obligations. Our team represents all three parties, including assisting trustees with administration, defending them in legal disputes, and representing beneficiaries when trust-related conflicts arise.
Responsibilities of the Trustee
Trustees are tasked with overseeing the trust according to Michigan laws, particularly the Michigan Trust Code (MTC), which defines their duties and legal boundaries. Key responsibilities include:
Beneficiary Notification: Trustees must formally notify all beneficiaries and interested parties of their rights and the trust’s existence. This notification can include sending registered letters, ensuring beneficiaries are informed of the six-month window for contesting the trust.
Asset Inventory and Valuation: A thorough inventory and valuation of the trust’s assets must be conducted. This may involve real estate, bank accounts, investments, and personal property. Trustees should secure these assets, maintaining their value and preventing loss during the administration period.
Debt Resolution: Trustees are required to notify creditors, settle legitimate debts, and pay the deceased’s final expenses. Proper notification shortens the creditors’ statute of limitations, generally reducing the time frame for any claims from six years to four months.
Filing Taxes: Trustees must file all necessary tax returns, including the decedent’s final income tax and any estate or inheritance taxes. This task can be complex, as tax obligations vary depending on the trust’s structure and asset composition.
Distribution of Assets: Once debts, taxes, and other obligations are addressed, the trustee distributes the remaining assets to the beneficiaries as stipulated in the trust. This requires careful attention to the settlor’s specific wishes.
Michigan Laws on Trust Administration
Trust administration in Michigan adheres to the Michigan Trust Code (MTC), which was implemented in 2010. It outlines the responsibilities of trustees, ensuring that they administer trusts in compliance with the law. Importantly, the MTC allows a trustee to accept or decline the role. Once accepted, the trustee’s actions must align strictly with the trust’s instructions, barring any legal findings of “undue influence.”
Common Trust Types and Their Purposes
Trusts serve various purposes, from providing financial security to preserving assets for specific goals. Here’s a brief look at common types of trusts under Michigan law:
» Revocable Trusts: These trusts allow the grantor to retain control over assets and make modifications during their lifetime. Assets are transferred to beneficiaries only after the grantor’s death.
» Irrevocable Trusts: Irrevocable trusts cannot be altered without the beneficiaries’ consent, offering potential tax advantages and asset protection not available with revocable trusts.
» Special Needs Trusts: These trusts safeguard a disabled family member’s eligibility for government assistance by managing inheritance without compromising their financial benefits.
» Charitable Trusts: Charitable trusts provide a means for individuals to leave assets to nonprofit organizations, often used to establish long-lasting legacies.
Our experienced estate planning attorneys can assist in drafting, administering, and interpreting various trust types to ensure they align with the family’s goals and needs.
Why Professional Guidance is Essential
Trust administration can be complex, particularly for those unfamiliar with fiduciary responsibilities. Common challenges include managing potential conflicts among beneficiaries, understanding Michigan’s specific legal requirements, and fulfilling all tax obligations. Trustees may face penalties for noncompliance, and errors can lead to disputes, trust litigation, or even personal liability.
At the Law Office of Shannon DeWall, we offer:
» Trustee Support: We guide trustees through Michigan’s legal requirements, helping them fulfill their duties with confidence.
» Beneficiary Assistance: Our team represents beneficiaries with any disputes or concerns, ensuring fair treatment.
» Asset Management Advice: We help trustees make informed decisions about safeguarding trust assets.
» Tax and Financial Guidance: Assistance in filing necessary tax returns and minimizing tax impacts.
Begin Your Trust Administration Journey with Us
Administering a trust is a profound responsibility, both legally and emotionally. Whether you are the trustee seeking guidance, a beneficiary with questions, or a family member wishing to establish a secure estate plan, our team at the Law Office of Shannon DeWall is here to provide personalized support. Reach out today for a confidential consultation to discuss how we can assist you in upholding your loved one’s legacy.