What Is Estate Administration?
When a person dies, certain tasks must normally be performed to wind up that person’s affairs, regardless of whether probate is required. These tasks typically include (among others):
- Identifying and valuing all property owned by the decedent;
- Paying the decedent’s debts, funeral expenses and expenses of final illness;
- Filing any required income, estate or other tax returns, and payment of taxes owed;
- Probating any assets for which probate is required (See “What is Probate?” below for more information);
- Making claims on any relevant life insurance policies;
- Completing any required documentation for transfer of certain assets to the beneficiaries (such as documentation for payable on death accounts and affidavits for transfer-on-death deeds and surviving joint tenants, for example);
- Notifying and instructing oil and gas operators regarding change in ownership status of mineral interests;
- Administering any trust of which the decedent was a grantor.
We have the knowledge to help the estate representative determine what needs to be done, and the skills and experience to assist. We can prepare the legal documents needed from time to time, such as property deeds and assignments, releases, instructions to oil and gas operators, affidavits, and claims.
What is Trust Administration?
Essentially, trust administration is the process by which the trustee acquires, values, inventories, manages, invests, and transfers or distributes trust property in accordance with the terms of the trust agreement. Trust administration also includes keeping relevant accounting and other records, maintaining and insuring trust assets as needed, filing any tax returns required to be filed by the trust, and paying any taxes owed from the trust property. Finally, trust administration eventually includes making final distributions of all remaining trust property to the named remainder beneficiaries as instructed by the trust terms, closing any bank or other accounts held by the trust, and providing a final accounting to the beneficiaries.
Depending on the situation and terms of the trust, a trustee’s administrative duties can be pretty simple with only modest required effort, or they can be complex and require significant work. It is important for the trustee to understand the trustee’s duties both under the terms of the trust agreement and also under state and federal law. Otherwise, the trustee can make mistakes that result in losses by the beneficiaries and legal claims against the trust. In some cases the trustee can be held personally liable for legal violations or losses suffered by the trust, its beneficiaries, or third parties.
We can provide the trustee with guidance and assistance as needed, to help ensure the trustee is acting in compliance with the trust agreement and relevant laws. This helps to protect both the trustee and the beneficiaries. Alternatively, we can help a concerned beneficiary determine whether the trustee has been properly administering a trust, and what corrective action should be taken, if any.
What is Probate?
With limited exceptions, any property a decedent owned in his/her name at the time of death must go through probate. This is true regardless of whether the decedent left a will. Probate is the court-supervised process of winding up a person’s financial and property affairs after the person’s death. The personal representative of the estate must perform certain tasks, including (among others):
- Submitting any will made by the deceased person to the probate court;
- Identifying, inventorying and protecting all property owned by the decedent;
- If the decedent owned real property such as land or mineral interests in another state, an “ancillary probate” must also generally be conducted in the court of the other state to clear title to the real property there.
- Identification and payment of the decedent’s debts, funeral and final illness expenses;
- Filing any required tax returns and payment of any income, estate or other taxes owed;
- Locating and notifying all potential heirs of decedent;
- After payment of all debts, taxes and expenses, distributing any remaining property to the persons entitled to receive it, as determined by the court.
We can guide and represent the personal representative of the estate through the very technical and often complicated probate process. We can prevent common mistakes such as missed deadlines and improper notifications that create problems, delays, and additional expense for the personal representative and heirs.
A relative or friend has passed away. Is probate required? That depends on multiple factors, including how the decedent’s property was titled at the time of death, the type of property, and its value. In certain cases, property the decedent owned at death can pass to the intended beneficiaries without probate. We have the knowledge to help you determine whether probate is needed.