A living trust, also called an inter vivos trust, forms an essential part of many estate plans. These trusts are renowned for their flexibility and privacy, offering anyone creating an estate plan a wide range of choices in how they want their estate managed. The person who creates a living trust is called a trustor, or sometimes a settlor, and gets to make key decisions about how the trust operates and who manages it. After the settlor dies the process of transferring trust property to new owners is generally known as trust administration. Here is what you should know.
When you create a living trust you choose who will act as the trust manager, a person or organization known as a trustee. After you die, it is the trustee’s duty to ensure that the trust property is properly inventoried and distributed in accordance with the terms of your trust.
Unlike property that you direct to be distributed through the terms of your last will and testament, trust property does not have to go in front of the probate court before new owners can take control. As long as the property was properly transferred to the trust in your lifetime, the trustee can distribute it without going before the probate court. This is very different than a will, which requires the court first approve the will and supervise the administration process.
Byrd : Garrett, PLLC is a member of the American Academy of Estate Planning Attorneys.