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What Do Successor Trustees and Executors Do?

Posted on: February 20th, 2018
Posted by:  The Life and Legacy Planning Group

Executor’s Duties
An Executor, sometimes called a Personal Representative, is the person who is named in a Will, appointed by the court, and responsible for probating the Will and settling the estate. Depending on the state, an Executor may work under court supervision or may use so-called “independent” administration for an unsupervised probate.
 
Typically, a petition must be filed with the court for an Executor to be appointed. If the person agrees to be the Executor, and no one objects, the court will issue Letters of Office. These letters authorize the Executor to gather the estate’s assets, sell assets, pay creditors, and open an estate bank account. An Executor is ultimately responsible for distributing the estate assets to the heirs in accordance with the terms of the Will. If there is no Will, then the Executor will distribute assets in accordance with state law. Distribution of estate assets, in either case, happens only after debts, taxes, and administration expenses are paid.
 
Trustee’s and Successor Trustee’s Duties
A Trustee, on the other hand, is an individual or trust company named in a trust document and is in charge of the assets that are held in a trust. Assets held in a Living Trust avoid probate, which means that court supervision is typically not required. In most Revocable Living Trusts, the person who created the trust acts as the Trustee. While alive and well, you can make changes including moving assets to and from the trust, changing its beneficiaries, or even revoking the trust entirely if you choose it is no longer necessary. If you are no longer able to manage your affairs, because of cognitive impairment or another injury, your Incapacity Trustee will step in and handle the trust for you. Upon your death, the successor Trustee will distribute the assets held in the trust to your named beneficiaries and subsequently close down the trust, similar to an Executor, without the burden of probate.
 
Other Thoughts
You have the option of having more than one Trustee or Executor. It is better to name a sequence of Trustees or Executors rather than naming them to act jointly. The Executor and successor Trustee can be different people, but do not have to be. Designating the same person as the Executor of your estate and as your successor Trustee will minimize expenses but naming different people to those positions will not allow one single person to have unilateral control. There are advantages and disadvantages to each setup. Give us a call today so we can help you select your Executor and Trustee.

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