Trust administration is the process of carrying out the terms of the trust either after the trust creator has lost competence or is deceased.  Although generally more flexible and less cumbersome than probate, trust administration is often more work than one would imagine.  An
experienced estate planning lawyer can help ensure compliance
with the law and the terms of the trust.


WHAT IS TRUST ADMINISTRATION?

Functionally, California trust administration is like probate, but without the constraints and costs of the court system.  And unlike probate, trust administration is private.  The basic steps of the process are similar to probate:

  • Reviewing the terms of the trust.
  • Marshaling the assets of the trust estate.
  • Paying debts, taxes, and other costs of administration as they come up.
  • Selling property or distributing the property to beneficiaries.  (NOTE: Unlike in a probate sale, a trust sale of real property is essentially the same as a private sale of real property.)
  • Accounting for the trust property and distributing assets in accordance with the terms of the trust.

Trustees often want the advice of an attorney, with attorneys' fees usually paid from trust assets, about how to properly go about the process.  For example, all beneficiaries and certain other people must be notified of a trust administration in many cases and this notification is important, because it limits the time period within which a person may challenge the validity of a trust.

Trust administration can be very simple (as in a trust distributing all assets to tone person), or they can get quite complicated (as in lifetime trusts in which the trustee has wide discretion as to whether or not to distribute trust assets).

Because a trustee is a fiduciary, the trustee has a special duty to the trust beneficiaries to see to it that the terms o the trust are executed properly and lawfully.  For this reason, it is often important to hire an experienced trusts and estates lawyer to advise you and ensure compliance with the law and the trust terms.