As you are creating your estate plan, it’s important to think about who in your life is best suited to serve as executor and/or trustee. These individuals will play key roles in determining how your assets are passed to your heirs.
The Estate Administration Process
Estate administration is the process of distributing a person’s property after they have passed away. It includes tasks such as:
- Gathering and managing assets
- Collecting money owed to the estate
- Paying any remaining debts and taxes
- Distributing property to the heirs according to the terms of the will or the state’s intestacy laws if the person died without a will
Probate court proceedings are sometimes part of the estate administration process but are not necessary for all circumstances. For example, some types of assets have named beneficiaries that pass outside of probate, and assets owned in joint tenancy pass automatically to the surviving owner. Trusts can also be used to avoid probate.
Estate administration tasks are performed by the executor, who is also known as the personal representative. This person is named in the will of the deceased. If there is no will, the court will appoint an administrator to serve this role. This is usually the person’s closest adult family member, such as a spouse, parent, adult child, or sibling.
If you are creating your will and need to choose an executor, you should select an individual who is at least 18 years of age who is responsible, in good financial standing, and well-equipped to handle any conflicts between family members. The executor does not need to physically live near you since administrative tasks can typically be handled virtually, and service providers are available to handle the majority of location-based duties. You should name an alternate person who can serve if your first choice is unable or unwilling to perform the role when needed.
Naming two people to serve as co-executors is often not recommended because Georgia law will require both individuals to sign off jointly on every decision that is made. This can be time-consuming and stressful but also increases the possibility of estate litigation if the co-executors can’t reach an acceptable compromise when they disagree.
When an executor needs assistance fulfilling their role in estate administration, they can hire an attorney. The attorney’s fees can be paid from the estate’s assets.
The Trust Administration Process
When a deceased person has their assets placed in a trust, the person who is responsible for overseeing how the assets in the trust are managed and distributed to beneficiaries is known as the trustee. The trustee’s role includes:
- Understanding the terms of the trust
- Ensuring the safety of trust assets
- Investing assets as appropriate
- Making decisions about how and when beneficiaries receive payments in accordance with the terms of the trust
- Communicating with beneficiaries about the status of the trust and answering questions as needed
- Keeping detailed records
- Preparing tax forms and filings
The trustee has a legal duty to act in the interest of the beneficiaries of the trust. This is of particular importance when the trust is intended to benefit a minor child or an adult with special needs.
When a person has both a will and a trust, the same individual often serves as executor of the estate and trustee of the trust. However, there are some circumstances where it might be appropriate to appoint two different individuals. If you do not have a friend or family member who is well-suited to assume the responsibility of being a trustee, it is possible to appoint a professional to act in this capacity. You should discuss your options with your estate planning attorney.
As with being an executor, a trustee is allowed to hire an attorney to help with tasks they are not able to accomplish on their own and to use trust assets to pay for the cost of assistance.
The Ward Law Firm Can Provide the Peace of Mind You Deserve
Estate planning helps ensure that your loved ones will be provided for after you’re gone. At The Ward Law Fim, we work closely with clients in Gwinnett County and throughout the state of Georgia to develop customized estate plans that fit their unique circumstances. Please call our office or use our online contact form to request a consultation with experienced estate planning attorney David J. Ward.