Living trusts have been a hot topic in estate planning in recent years- and for good reason.  Living trusts make the transition of death for family members a much easier process than without one.  The primary advantage of a living trust is that property in a trust is not subject to probate. Another advantage of executing a living trust is conservatorship avoidance- also a court supervised proceeding.
In California, probate proceedings can be extremely costly due to court fees, publication fees, probate referee fees, and of course, attorney’s fees. Attorney’s fees in probate proceedings are calculated based on the assets in the deceased individuals total estate.  These fees are based on statute, and are generally awarded to the attorney representing the executor or administrator in a probate proceeding.  And, if property is involved, attorney’s can request what are known as “extraordinary fees” in probate proceedings. This fee is in addition to the normal statutory fee attorney’s are paid. Attorney’s fees can add up pretty quickly in probate proceedings. In addition to the cost savings, a living trust that has been properly funded can be administered within a few months.
Executing a living trust allows the trustee to act more quickly than an executor or administrator could to administer and distribute an estate.  The reason is that a trustee can act independently and without court supervision. The initial petition to administer the estate, a petition to confirm sales of property, petitions for instructions, and a petition for final distribution all have required notice periods that contribute to the time delays of a typical probate. Except for the filing of the estate tax return, a typical trust often can be administered in a few months, whereas a typical California probate estate lasts a minimum of a year to 18 months (California Estate Practice (Cal CEB).
In addition to the benefits of ease of estate administration at death, a funded trust can also prevent  the costs and inconvenience of formal conservatorship proceedings in the event of incapacity.  The costs of implementation and management of a conservatorship estate can be devastating to a family.  Executing a living trust can prevent this from happening. If someone who has executed a living trust becomes incompetent or incapacitated, the terms of a living trust can provide a method for determining incapacity or incompetency relating to trust estate management.      A smooth transition of administration can occur because the trust estate will be managed by a successor trustee selected by the person who initially executed the living trust. The trust also can assure that the incapacitated person is properly provided for in accordance with a standard of care designated in the trust.
Similar to probate at death, conservatorship proceedings are managed by the probate court, and similar cost and time issues are involved.  A petition is required, assets are appraised by a probate referee, an investigation by the court is done- all of which cost.  In addition, attorney’s fees and conservator fees can add up to thousands in the first year alone.  Notices similar to those in probate proceedings at death are required in conservatorship proceedings, and information relating to ones incapacitated condition is made public through court documents.  If a trust is properly executed and funded, information relating to ones incapacity remains private and court involvement is not required. A successor trustee can assume their duties without the delays of court supervised conservatorship proceeding.
Many individuals still have not executed living trusts, and the full probate court calendar is a testament to this fact.  VDG Law provides comprehensive estate plans for individuals and families to ensure that the transition of your incapacity or death is seamless. Contact VDG Law for a consultation, and plan ahead so that you can save a lot of time and money in the future.
***The information in this article is provided for informational purposes only and does not constitute legal advice. Transmission of this information or the receipt of this information does not constitute an attorney-client relationship between the sender and receiver of this newsletter. You should not act or rely on any information contained in this newsletter without first seeking the advice of an attorney.This article is the sole property of the Law Offices of Verleana D. Green. Please do not use without our permission. Thank you!
Tagged with →  
Share →

Looking for something?

Use the form below to search the site:


Still not finding what you're looking for? Drop us a note so we can take care of it!

Visit our friends!

A few highly recommended friends...

    Archives

    All entries, chronologically...