My inlaws put everything in a trust, with my husband as executor. When my MIL passed recently, my BIL made a number of mentions of the trust and assets, sending a big warning sign to me. We all adore my FIL and pray he's with us many years to come, so this is not sitting well with us. When Dad passes, my husband will be grief stricken since they're so close, and will not be up for dealing with any trust stuff right away. I know that BIL will fly in and expect things to begin rolling ASAP. I'd like to have some sort of outline of what the process is so I can help my husband deal with this bs while he's dealing with his own grieving.
There are things that can be done now. Just so I understand, your husband is successor Trustee, which means that the Trust identified someone else to precede him after your FIL's death. But he is not a Co-Trustee? Is that first Trustee a relative (often the spouse) and on good terms with your husband so that the two of them could work together to lay the groundwork now?
If you've already done this, I apologize. I'm just thinking of what I did when my sister died and am glad I had the information I had. It really made a big difference.
In addition to the Trust, you may have a Certificate of Trust Existence and Authority, which summarizes the naming of the Settlor, Trustee(s), and Successor Trustees, if any. It also excerpts generally the most important empowerment clauses of the Trust.
If you have to provide documentation of the Trustee's authority, or when you set up a Trust checking account, this is the document you use, instead of the full voluminous Trust.
What can be done now:
Inventory all liquid and semi-liquid assets (stocks, bonds, mutuals, savings and checking accounts, IRAS, governmental or corporate retirement plans (if any), life insurance policies and all sources of income (SS, military, pension, etc.).
It helps to have them together by category in a file or binder. You could even list holders, contact numbers and policy/account numbers, which is what I did. Then when I sent death notification letters, I could just excerpt the information from the spreadsheet I had created when I did the inventory.
Inventory credit and/or debit accounts, as they'll need to be closed unless held jointly with one of the family members who may want to keep them open until the funeral costs are paid (plot, flowers, grave marker, etc.)
Depending on how thorough the attorney was who drafted the trust, there may or may not be a Bill of Sale which transferred assets (such as collectibles, cars, etc.) into the Trust.
And that's a very important issue: if the Trust hasn't been funded, the assets have NOT been transferred into the Trust. This means that the assets need to be retitled in the name of the Trust.
There are some specific issues as to transferring IRAs into Trusts; we initially did but then transferred them out because of compression tax rates on IRAs. This is a really complex issue which needs to be discussed with the attorney who prepared the Trust documents because of the tax ramifications.
List homeowners and vehicle insurance contact information. I found that the Secretary of State refused to retitle my sister's vehicles in the Trust, and her insurance carrier wouldn't issue polices in the name of the Trust. So I had to retitle them in my name. This is something the BIL might contest and fight because it appears as though a transfer of assets is being made outside of the Trust provisions.
If there are collectibles (such as guns), get model numbers and as much detail as possible as this will help when selling them. Gun collectors want to know a lot of information besides the caliber, etc. and unless someone is really familiar with weapons, it's time consuming to research that.
The funeral parlor staff in my experience gets the Death Certificates which you'll need to send to holders of liquid assets (along with an EIN notification - see below) and the Certificate of Trust Existence and Authority.
This was standard in 2002; I haven't checked IRS regs to see if there have been any changes, but then, I had to
apply for an EIN (Employer Identification No.) from the IRS. EINs are used to identify Trusts as SS numbers identify people. The fact that's it's called an "Employer..." doesn't mean anything as the form you'll use to apply has a box you can check to indicate that it's a Trust. (This can get complicated though; there are several different kinds of Trusts).
Holders of liquid assets, pension plans, etc. should be notified of the Trust's EIN number once the IRS issues it. These numbers will be used to issue end of year tax information.
The instructions and forms for IRS 1041 are good guidelines from which to start. They're also good bedtime reading. Some sections were so obtuse that they put me to sleep, truly. I began reading them at bedtime so I could fall asleep.
One of the issues that arose in my administration arose from a clause requiring that "expenses of the last illness be paid as priority claims". When we get our EP updated, I intend to ask that that include expenses of distribution and resolution of assets, so that funds can be directed toward sale of the real property before any distributions are made to beneficiaries. That presented a real problem for me.
That would also prevent BIL from rushing to get the assets distributed.
Hope this helps; it's been a nice walk down (legal) memory lane for me.
Do you have a religious affiliation? Observing strict forms of mourning can be very helpful in giving people a framework for their grief, apart from anything else. It tells everyone - family, lawyers, friends, neighbours - to get lost until the departed is at least cold in his grave.
I expect your friendly neighbourhood lawyers' office (or online equivalent) will have user-friendly leaflets about what the normal procedures are, but if the trust is sizeable and/or complex you'd better double whatever schedules are suggested. BIL will just have to accept that wonderful phrase: "in the fullness of time." Or get bit.
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