What do Successor Trustees and Executors do?
Executor Duties
An Executor, sometimes called a Personal Representative (or “PR”), is the person who is named in a Will, appointed by the court, and responsible for probating the will and settling the estate.
An Executor, sometimes called a Personal Representative (or “PR”), is the person named in a Last Will and Testament who carries out the writer’s final wishes. The Executor must be formally appointed by the court (“qualified”) and is responsible for probating the will and settling the estate. Depending on the state, an Executor typically works under court supervision (or, in some instances, may use so-called “independent” administration for an unsupervised probate). If a person dies without making a Will (“intestate”), the person who is appointed to be in charge of settle the estate is referred to as the “Administrator,” but the process to be appointed is the same.
An Executor is ultimately responsible for distributing the estate assets to the heirs in accordance with the terms of the Will.
Qualifying to Serve as Executor or Administrator of an Estate.
Typically, a petition of probate, also referred to as “qualification,” must be filed with the court for an Executor to be appointed. If the person agrees to be the Executor, and no one objects, the court will issue ‘Letters Testamentary.’ These Letters authorize the executor to gather the estate’s assets, sell assets, pay creditors, and open an estate bank account.
An Executor is ultimately responsible for distributing the estate assets to the heirs in accordance with the terms of the Will. If there is no Will, then your executor will distribute assets in accordance with state law. Distribution of estate assets, in either case, happens only after debts, taxes, and administration expenses are paid.
Trustee Duties
A Trustee, on the other hand, is an individual (or trust company) named in a trust document who is in charge of managing the assets that are held in that trust. Assets held in a living trust avoid probate, which means that court supervision is typically not required.
Assets held in a living trust avoid probate, which means that
court supervision is typically not required.
In most Revocable Living Trusts (RLT), you act as your own Trustee.
In most revocable living trusts, you act as your own Trustee. While alive and well, you can make changes including moving assets to and from the Trust, changing its beneficiaries, or even revoking the trust entirely if you choose it is no longer necessary.
Alternate Trustees
If you are no longer able to manage your affairs, because of cognitive impairment or another injury, your ‘Incapacity Trustee’ will step in and handle the trust for you. Upon your death, the ‘Successor Trustee’ will distribute the assets held in the trust to your named beneficiaries and subsequently close down the trust, similar to an executor, without the burden of probate.
Other Thoughts
You have the option of having more than one Trustee or Executor. It is better to name a sequence of Trustees or Executors rather than joint one.
The Executor and Successor Trustee can be the different people, but do not have to be. Designating the same person as the Executor of your estate and your Successor Trustee will minimize expenses, but naming different ones prevent one single person from having unilateral control. There are advantages and disadvantages to each approach. Give us a call today so we can help you select your Executor and Trustee.
It is better to name a sequence of Trustees or Executors rather than joint ones.
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