Administration of Trusts in Florida

A trust is a legal document allowing you to have your assets held and managed by a third party, a trustee. Trust administration is the legal process following the trust maker’s death. The trustee is tasked with following the trust’s instructions, and working in the best interest of the beneficiaries. Trust administration is governed under Chapter 736 of the Florida Statutes. These documents are created for many reasons, and what the law requires varies greatly with the kind of trust in question.

There are many kinds of trusts. The type of trust that is right for you depend on your situation. A frequently executed trust is a revocable or living trust primarily created by someone for estate planning purposes or in case of incapacity. Revocable trusts are best known for their ability to bypass probate, which can be a lengthy and costly process. They protect the family’s privacy, as they are not a matter of public record. While the creator of a trust is alive, it is generally treated as a disregarded entity, and little administration is required. A revocable trust can be amended or revoked at any time by the creator (grantor) while they are living.

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The successor trustee, often a family member, will have numerous duties and responsibilities concerning the administration of the trust, such as preparing an inventory, filing tax returns, and allocating and distributing assets. After the creator’s death, however, this kind of trust becomes irrevocable — and may even split into one or more sub-trusts. At that time, the successor trustee will need specialized legal and tax advice to administer the trust properly.

The failure to properly discharge these duties can result in loss to the trust or its beneficiaries and liability for damages imposed upon the successor trustee. Professional legal and tax advice is essential to ensure that the purposes for which the trust was created are fulfilled and that the successor trustee carries out their duties under the terms of the trust and applicable law.

Trusts Requiring Professional Legal Counsel include:

  • Irrevocable life insurance trusts
  • Trusts for minors
  • Trusts for grandchildren
  • Special needs trusts
  • Testamentary trusts
  • Charitable trusts
  • Irrevocable trusts
  • Generation-skipping trusts
  • Totten trusts
  • Revocable trusts

Pros and Cons of an Irrevocable Trust

An irrevocable trust generally cannot be amended or revoked during the grantor’s lifetime. Therefore, once executed, the grantor loses complete control of their assets. However, it is a valuable tool under certain circumstances and is often used to become eligible for government programs like Medicaid. In addition, it protects assets from creditors and minimizes estate taxes.

Call C.J. Hilliard Law, P.A. for Your Trust Administration Needs

Setting up a trust and settling an estate can be perplexing and overwhelming to a successor trustee who has just experienced the death of a loved one. At C.J. Hilliard Law, P.A., we have the experience and knowledge to guide you through the process and minimize the difficulties. Our law firm focuses on estate planning, wealth transfer planning, probate and trust administration, and resolving trust and will disputes. If you have questions about setting up a trust, or are facing a battle over the administration of a trust, we are here to help.

The legal team at C.J. Hilliard Law, P.A. handles a wide range of estate planning matters. We devote time to each client to fully understand his or her assets and goals. We represent clients in Orlando and Central Florida. Call our Winter Garden, Florida office at (407) 656-1576 to schedule an appointment with an experienced and knowledgeable estate administration lawyer.

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