Probate vs. Trust Administration
Aug. 31, 2022
Perhaps one of the most important things we do while we are alive is plan for when we die. However, estate planning is put off by most people for a variety of reasons, none of which matter if they die before they create one.
The mere mention of the word “probate” brings up all kinds of negative connotations, but that is definitely where your estate will end up if you die without an estate plan. If you prefer that your estate avoid probate, you can make that happen by working with an experienced estate planning attorney.
If you live in Woodland Hills or anywhere throughout the San Fernando Valley, including the counties of Los Angeles, Santa Barbara, or Ventura, get the information you need in the probate vs. trust administration debate. At The Law Offices of Kenneth W. Drake, Inc., I will walk you through the advantages and disadvantages of both so you can make the best decision for you and your loved ones.
What Is Probate?
Probate is a court procedure that supervises the administration of an estate of someone who has died, referred to as a “decedent.” The purpose of probate is to gather assets, pay debts, and distribute what is left over to the heirs of the estate.
If the decedent had a will, the court must validate or invalidate it. The personal representative named in the will is then responsible for inventorying the decedent’s assets and publishing notice so creditors and individuals have the opportunity to assert claims against the estate. Once the debts have been satisfied, the residual of the estate is distributed among the heirs of the estate as directed by the decedent in the will.
If there is not a will, the court will appoint a personal representative whose responsibilities are the same as one named in a will. However, the residual of the estate will be distributed to those who inherit under the laws of intestate succession rather than to whom the decedent may have wanted to benefit.
What Is Trust Administration?
When you establish a living trust, you transfer ownership of your assets to the trust. Trust administration involves the management of those assets by the trustee of the living trust for the benefit of the beneficiaries named in the trust by the maker of the trust.
Many trust makers serve as trustees while they are alive and name a successor trustee to assume this role when they die. Upon death, the trustee continues to manage the assets of the trust and distributes those assets as directed in the living trust.
How Do Probate and Trust Administration Affect My Family and Loved Ones?
Estate planning revolves around two things: the wishes of the plan owner and the benefit of survivors, which could include nonprofit organizations and pets. Here are some facts you should know about how probate and trust administration affect your family, loved ones, and other beneficiaries.
Probate takes time, costs money, and becomes public record. Although California law holds that the personal representative should complete probate administration within one year, it can take as long as 18 months. Moreover, if a will is contested, if can take even longer and cost more. In addition to estate planning, The Law Offices of Kenneth W. Drake, Inc. handles litigation stemming from probate disputes. I know how much time and money can be spent in litigation.
There are routine court fees, and creditor claims may consume a substantial portion of the estate, leaving less for distribution to the heirs. Moreover, because probate is a judicial process, it is public. That includes the contents of a will, if there is one, and all documents filed with the court throughout the probate process.
Creating a living trust is more expensive than executing a will. There is more involved with transferring ownership of assets, management considerations, and beneficiary designations. However, trusts are not subject to probate, which means the terms of the trust, its assets, and its beneficiaries are not public information. Additionally, the administration of the trust can begin immediately upon death and depending on the terms of the trust, distributions made right away.
Trusted Guidance When You Need It Most
As a probate attorney, I can represent parties in creating wills and litigating estates. As an estate planning attorney, I can help you avoid probate by creating a trust and even by administering the trust when you are gone.
Estate planning is not something you should put off. It is simply too important to you and to those you leave behind. Start today by calling The Law Offices of Kenneth W. Drake, Inc. in Woodland Hills, California.