A trust settlement checklist is a must-have if you have been named as successor trustee on a trust. After the death of an individual, their estate plan needs to be administered. This process is called post-mortem administration and is a series of tasks performed by a fiduciary named in the estate planning documents. The fiduciary of a trust is called a successor trustee.
Serving as the successor trustee of a trust is not a role to be taken lightly. Administration can be an arduous and time-intensive project even for a professional trustee, let alone an individual trustee who may not be familiar with the fiduciary duties and liabilities they are undertaking. If you have been named as successor trustee on a trust, the following checklist may serve as a guide of some of the duties you may perform in settling the trust and carrying out the wishes of the decedent.
If you have any questions about the above trust settlement checklist, please email info@icontrustnv.com or call 702-998-3700.
A corporate trustee is a bank or independent trust company that is licensed to act as trustee of a trust.
The primary function of a trustee is to administer trust assets according to the grantor’s wishes while considering the interests of the beneficiaries of the trust.
In a traditional trustee arrangement, one trustee wears all three hats. The trustee is responsible for the investments, distributions, and administration of the trust. Thankfully, over the last twenty-five years, many states have amended their laws to allow for the splitting of trustee duties, commonly referred to as a directed trust arrangement. This arrangement allows for the bifurcation or trifurcation of trustee duties giving trust grantors, beneficiaries, and their professional advisors more control over a client’s estate plan. Grantors can now decide which hats they want their trustee(s) to wear and what powers they retain. The grantor can select one sole trustee with full powers, or multiple trustees to wear different hats and retain only certain powers.
Irrevocable Trusts
If you are setting up an irrevocable trust while you are alive, you will need a trustee to act today. Some of the reasons you might set up an irrevocable trust are for asset protection, gifting, estate tax planning, income tax planning, charitable planning, opportunity shifting, etc. You will need to separate yourself from the assets and having a trustee in a top trust jurisdiction can be to your benefit for state income tax savings and asset protection.
Revocable Trusts
There are many factors to consider if you have a revocable living trust and are looking for a successor trustee to take over in the event you become incapacitated or pass away. Please look at the following chart to determine whether a family member or a corporate trustee makes the most sense within your estate plan.
| Individual | Corporate Trustee | Advantage | |
| Experience | Do they have experience serving as a trustee? Do they know the responsibility & liability of serving? Do they want to serve? | Has Trust Officers trained in trust administration with expertise in record-keeping, tax and trust law. | Corporate Trustee |
| Time / Resources | Do they have the time required to administer a trust? Do they have the appropriate resources? | Has a full-time dedicated staff and a network of estate planning professionals. | Corporate Trustee |
| Cost | Has the discretion to charge a fee, usually drafted into the trust document, or determined by state statute. | Should have a published fee schedule on their website. Usually more expensive than an individual trustee. | Individual Trustee |
| Knowledge of the Family | May have more intimate knowledge of the grantor, his or her wishes, and the beneficiaries | May have less intimate knowledge of the grantor, his or her wishes, and the beneficiaries. | Individual Trustee |
| Impartiality / Objectivity | Biased. It is very difficult for individuals to not show biases during trust administration. Can they make difficult decisions without emotion, strictly based on the trust provisions? | Unbiased. They can only do what the trust document tells them to do. They are not affected by emotion and have the appropriate tools to make difficult decisions. | Corporate Trustee |
| Location for state income taxes | Do they live in a state with a state income tax or a creditor friendly jurisdiction? | Does the corporate trustee reside in a favorable jurisdiction like Nevada for tax and creditor protection? | Corporate Trustee |
| Continuity | What is their age? | Corporate trustees continue in perpetuity. | Corporate Trustee |
| Removal process | Will they resign if asked by the beneficiaries? | Run a business and will typically resign if asked by the beneficiaries. | Even |
| Regulated / Insured | Not regulated. | Financially stable and carry insurance to protect the beneficiaries. | Corporate Trustee |
For more information please give us a call at 702-998-3700 or email info@icontrustnv.com
The following key benefits of Nevada law have made Nevada the top trust jurisdiction in the United States. You do not have to live in Nevada to take advantage of Nevada's favorable trust and tax laws.
Nevada does not tax individuals or trusts at the state level.
Commonly referred to as the rule against perpetuities, a Nevada trust may last 365 years. A trust lasting 365 years, combined with no state income taxes levied at the death of each generation, can create substantial compounding growth over multiple generations.
Allows for the splitting of trustee duties into multiple roles: An Investment Trustee or Investment Advisor, with the sole discretion to make investment decisions on behalf of the trust, an Independent trustee or Distribution Trustee with powers to make distributions from the trust, and an Administrative Trustee responsible for maintaining the books and records of the trust.
Legally termed Nevada Self-Settled Spendthrift Trusts
A grantor may create an irrevocable trust in Nevada for their own benefit. The grantor is the creator of the trust as well as a permissible beneficiary. NAPTs are established to protect a portion of the grantor’s assets during the grantor’s lifetime. Nevada is one of only 19 states that allow self-settled trusts and is consistently ranked as the top self-settled trust state for the following reasons:
f you have any questions about the key benefits of Nevada law, please email info@icontrustnv.com or call 702-998-3700.
