How to Settle an Estate with a Trust?


A trust is a is a legal arrangement in which a person entrusts their property and funds into the hands of a third party who will distribute that person’s property and funds to their beneficiaries upon his or her death. That third party is referred to as the trustee, or successor trustee in the case of a living will. It is the job of the successor trustee to settle the affairs of the deceased individual and distribute their assets as agreed upon in the trust. If you find yourself having to settle an estate with a trust, do not panic. There are a few key steps you can take to help you along your way.

Make Some Calls

In the case of simple trusts, it will only take about six months to get most of the work taken care of. One of the first steps you will want to take is to find the trust and other supporting documents. Read over the trust and look for any specific instructions that the grantor (original owner of the trust) wrote out for you. Next, you will want to get in contact with the following people; you will be working closely with these individuals as you settle the grantor’s estate:

  • co-successor trustee (if the grantor named more than one trustee)
  • executor (if the grantor had a will)
  • grantor’s family

While you are making these calls, inform the Social Security Administration and the state Department of Health of the grantor’s death. Also consider getting in contact with a lawyer. You do not need to do this immediately after the grantor’s death, but there are certain tasks that will require an attorney’s assistance.

Stay Organized

Over the next several months after the death of the original trustee, you will want to start collecting information. This includes mail, medical expenses, funeral expenses, administrative expenses, and personal debts. Also, go over the trust again looking for what it owned and what it owed. You will need to keep a record of the assets’ gains and losses before it is transferred to its beneficiaries. Appraisers can help you figure out the value of the assets the trust owned. As you do all this, complete the following list:

  • get death certificates (around 12)
  • if the grantor had a will, find and file it with the local probate court
  • inventory trust assets
  • protect trust property
  • get a Taxpayer Identification Number
  • transfer property into your name as trustee
  • review trust investments
  • set up a record-keeping system
  • get assets appraised
  • pay debts
  • return last Social Security payment

These tasks are the basic steps that every trustee needs to take to settle an estate. They will require organizational skills as you collect bank and brokerage statements, bills, and track expenses. If the all the assets will not be administered within six months of the death, consider purchasing a basic accounting software for improved organization.

Keep Beneficiaries Informed

The ultimate task of a trustee is to distribute the trust’s assets to the beneficiaries named in the document. This can be done after a final account of assets and bills paid has been made. If the trust is ongoing (beneficiaries receive assets after a certain age or in installments), you will be required to continually monitor and keep up with the trust. It may be beneficial to you to get help from experienced probate lawyer to properly complete the process.

Call our Probate team at (480) 467-4365 to discuss your case today.

Contact Probate Attorney Ryan Hodges

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