Important Trust Terminology Grantor: The grantor is the person who creates the trust and transfers property to it. A grantor is sometimes known as the settlor or donor of the trust. The successor trustee is the person who takes charge of managing the trust’s assets if the trustee becomes unable to do so.
What happens to an irrevocable trust when you die?
Overview. When the grantor, who is also the trustee, dies, the successor trustee named in the Declaration of Trust takes over as trustee. The new trustee is responsible for distributing the trust property to the beneficiaries named in the trust document.
How do you become a successor trustee of a trust?
If you’re the successor trustee, you must obtain certified copies of the death certificate and prepare an affidavit of death of a trustee, affidavit of duties, or other similarly named document to prove you’re the successor trustee. The affidavit, along with certified copies of the death certificate, allows you access to the trust’s property.
What happens to a living trust after death?
Administering a living trust after your death is not cost-free. Even if probate is avoided, the successor trustee should usually seek help from a lawyer in making sure that your debts are paid, all of the necessary tax forms filed and the assets in your trust legally distributed to your beneficiaries.
When does a living trust file a tax return?
After the Death of the Grantor: Living Trust Taxation After a grantor’s death, a trust becomes irrevocable and continues as its own entity responsible for its taxes. An executor files the final tax return for any income that was earned during the final moments of the grantor’s life.
Can a revocable living trust go to probate?
Revocable living trusts avoid probate, but you might have created a pour-over will to move assets not in the trust into your trust at the time of your death. This process would require probate. Serving as a successor trustee is a huge responsibility, and it’s often a time-consuming burden.