Executor of Living Trust questions

[Multi]

Hi - can someone please expand more on what it means to be an executor / trustee of a living trust? this is for a relative based in California.

A few questions:
- Does the proposed executor / trustee need to sign the trust before actually being named? or can the person just simply name the executor / trustee assuming s/he will do the work upon passing away?

- Does being an executor / trustee mean any of the estate could be inherited? or rather the opposite - being an executor / trustee means none of the estate could be inherited?

- There could be up to 4 people named as executor / trustee on this living trust with two of them based in different countries. how will administering this living trust work in practice? All 4 people need to agree on living trust actions? or 1 person could be nominated to execute it?

Thanks

[97guns]

The trustee only overlooks the trust and makes sure it is distributed as directed by the trust, no signature is needed by the trustee to be assigned this task, only needs to be directed so in the trust. There is usually a trustee and 2 backups in case the first can not do it. I was executor of my dads trust and was entitled to 2% of the entire trust in addition to any inheritance given to the trustee, I did not take the 2%.

[Multi]

Thx for the quick response. What about the 3rd question about multiple executors?

[97guns]

There is always the 1st executor then the backups, I don't think multiple executors can work together on the distribution. The first executor is usually named power of attorney as well

[Multi]

ok then what is the purpose of multiple executors then?

[disneysteve]

ok then what is the purpose of multiple executors then?

I'm not an attorney but I must say I've never heard of there being multiple executors. That sounds like a recipe for disaster when the parties involved disagree on something.

If I was named an executor in that situation, I think I would decline the position. Who needs that headache?

[Multi]

what if the executor was named but didn't do the job?

[Drake3287]

That statement about the 2% executor fee is an interesting one. I'm the executer on my mom's trust and I have many siblings. I'm also financially stable so any inheritance money is just 'extra" money in my pocket. For my siblings, it's a huge windfall. (as small as it might be)

The problem for me is when she does pass on, the work required by me to clean up the entire estate mess including selling her house will be a handful in both time and maybe money for me.

Like many children, I'd feel bad about taking an extra fee from my mothers estate but at the same time at what point do you say enough is enough because of all the time and work required. I'm sure this topic has caused many family fights.

I'm more then happy to do it for free but the thought of doing everything myself while the others sit back and wait for their money might be a little to much to handle. Not looking forward to the day it happens.

[Dido]

Is this really a LIVING Trust? If it is a LIVING Trust, then the person is still alive, and if someone else is in charge of the assets, that person is called a Trustee, not an Executor. Executors apply to wills.

If it is a TESTAMENTARY TRUST (a trust created under terms of the will after someone dies), then Executor would be ok to say. Exectuors deal with Estates.

There are at least THREE parties to any trust, although sometimes the SAME person can indeed play more than one of the roles. The three parties to any trust are:

The Grantor (Testator) = the person who establishes the trust. Only this person (plus the required witnesses) actually needs to sign the trust, but appointing someone a Trustee or Executor without getting their permission is a recipe for trouble.

The Beneficiaries = the people who get the benefit of the assets and income from the trust. Often, there are two sets of beneficiaries: the Income Beneficiaries. who receive the annual income (interest, dividends, rents, royalties, business income) that are created by the assets in the trust, and the Principal Beneficiaries, who ultimately get the assets in the trust and usually also add any capital gains generated by the assets to the principal in any year.

The Trustee (or executor) = the person who handles the money fairly and under terms of the governing document and the law for the other two parties.

One and the same person can be the Grantor, the Beneficiary, and the Trustee in the case of a Revocable Living Trust while the Grantor is alive.

In the case of married couples, it is VERY common for the surviving spouse to be both the Trustee and the Primary Benefciary.

Read the terms of the Trust document carefully and consult with a lawyer. Is it really four separate trustees or are there "contingent" or "successor" trustees? In the latter case, they would not all be working at the same time.

Co-Trustees are fairly common--for example, a parent may make all of the children co-trustees. As long as the children get along with each other and each does his/her part, this is not a problem, but if they do not get along or one of them doesn't do his/her share of the work, that can mean trouble. It's pretty common for a parent to name all of the kids as co-Trustees but then only the child who physically lives closest to where the part lived ends up handling the work (and may take reasonable compensation from the Estate for doing so; most states have rules indicating what percentage of an estate counts as reasonable compensation depending on the value of the assets in the estate).

Another situation where you see co-Trustees is when a person who had two marriages and has children by the first marriage appoints someone else as a co-Trustee along with the surviving spouse to make sure that the children from the first marriage are getting their share of the income and that the surviving spouse is not keeping it all for him/herself.

Trustees who are appointed can always refuse the appointment, in which case the courts will appoint someone else, and very often wills and trusts allow for the trustees to appoint corporate or institutional trustess who can actually do the work.

[FLA]

That statement about the 2% executor fee is an interesting one. I'm the executer on my mom's trust and I have many siblings. I'm also financially stable so any inheritance money is just 'extra" money in my pocket. For my siblings, it's a huge windfall. (as small as it might be)

The problem for me is when she does pass on, the work required by me to clean up the entire estate mess including selling her house will be a handful in both time and maybe money for me.

Like many children, I'd feel bad about taking an extra fee from my mothers estate but at the same time at what point do you say enough is enough because of all the time and work required. I'm sure this topic has caused many family fights.

I'm more then happy to do it for free but the thought of doing everything myself while the others sit back and wait for their money might be a little to much to handle. Not looking forward to the day it happens.

If you do all the work, which I am anticipating in my own family, you should not feel bad about taking the extra money. Being an executor is not easy and if no one offers to help, well, then tough on them.

[Outdoorsygal]

I am wrapping up being the Trustee (it's akin to an Executor of a Will) of my husbands Uncle's trust. We took care of him in Hospice

I think it is 1% of the value of the trust (in California) the Trustee accepts as payment but can be more $$ depending upon duties. But this the typical payment to the Trustee to execute the trust. A Trustee to a Trust is akin to an Executor of a Will, same thing.

There is a time-frame to get some tasks done. Notices must be sent within certain timeframes to the beneficiaries. This is usually this is the easy part. Beware the Attorney may want to make it seem difficult and want to take this part over. I did it myself to save the trust /beneficiaries0 $$. No biggie.

I was listed in the trust as the trustee yet no one asked me. He told me on his death bed. One-two other people were named if I declined, and if htey declined, a Bank could take over the duties.

Generally it is alot of work for little pay. But much of it has to do with whether you live nearby the deceased, their assets, past due bills, etc..

[Outdoorsygal]

That statement about the 2% executor fee is an interesting one. I'm the executer on my mom's trust and I have many siblings. I'm also financially stable so any inheritance money is just 'extra" money in my pocket. For my siblings, it's a huge windfall. (as small as it might be)

The problem for me is when she does pass on, the work required by me to clean up the entire estate mess including selling her house will be a handful in both time and maybe money for me.

Like many children, I'd feel bad about taking an extra fee from my mothers estate but at the same time at what point do you say enough is enough because of all the time and work required. I'm sure this topic has caused many family fights.

I'm more then happy to do it for free but the thought of doing everything myself while the others sit back and wait for their money might be a little to much to handle. Not looking forward to the day it happens.

It is expected you take the fee, so not sure why this would cause a family fight.
It is customary to charge, and trust me, the fee won't nearly cover all of the work involved.
But if you want to do your siblings a favor, and considering it sounds as if they are not financially secure as you are,it would certainly
be understandable for you not to pay yourself the fee.

[97guns]

It is expected you take the fee, so not sure why this would cause a family fight.
It is customary to charge, and trust me, the fee won't nearly cover all of the work involved.
But if you want to do your siblings a favor, and considering it sounds as if they are not financially secure as you are,it would certainly
be understandable for you not to pay yourself the fee.

I declined taking the 2%, it would have come out to around $15k. sure I did some legwork calling and transacting with several brokerage firms, making numerous trips to the attorney and it was a bit of a headache but I would say no more than 8 hours spent with everything all said and done, 15k would have been gouging the trust imo

[Outdoorsygal]

I declined taking the 2%, it would have come out to around $15k. sure I did some legwork calling and transacting with several brokerage firms, making numerous trips to the attorney and it was a bit of a headache but I would say no more than 8 hours spent with everything all said and done, 15k would have been gouging the trust imo

Oh ok. My 1% was very low but the home I had to sell was in Los Angeles and we live in Northern California.
But it all worked out ok, well at least so far. House sale kept falling thru though, the third time was the charm

[FLA]

I am going to be my parents' executor. I'm dreading it. All they'll have is the house in a trust for my brother and me and cash. I heard life insurance is outside of the will.

Did you have to have a ton of contact with your siblings to make decisions, like for the house? Or as executor, could you just make them yourself?