What is trust administration?
It’s common to refer to running any trust as administering it. This means that when you create a living trust and appoint a trustee, it is the trustee’s job to manage that trust. However, once you create a living trust and then die, the trust administration process involves what happens to that trust and how its property is distributed to beneficiaries.
Who inherits a living trust property?
After a trust maker dies, it is up to the trustee to distribute all trust property in accordance with the terms of the living trust. The trust maker, known as a settlor, gets to determine how that property gets distributed. In some situations a settlor can use a living trust to protect the trust property from any estate creditors. Similarly, it is completely up to the trust maker to determine who receives the property.
Will the trust have to go through probate?
One of the great benefits of a living trust is that you get to distribute your property outside of probate court. Unfortunately, if you make a mistake during the trust creation process, your survivors may have to go to probate court after all. If, for example, you failed to properly transfer property to the trust before you died, that property may have to go through probate before new owners can take possession. However, in this scenario it’s very common to create a “pour over” will that transfers all your remaining property to the trust. Even though the will have to go through probate, you can still use the trust to distribute property.