Have you ever wondered what actually takes place with a trust once the person who created it is no longer living? We often think about taking care of loved ones, but it can be tough to picture how a trust will move forward.
At Jordan & White, on the North Shore of Massachusetts, we see every day how proper planning can help families stay on track when a grantor passes on. Today, we want to shed light on the steps that occur after a trust’s creator (often called the grantor) dies.
The Role of the Trustee After the Grantor’s Death
A trust depends on the person in charge, known as the trustee, to ensure everything happens correctly once the grantor dies. The trustee is bound by the instructions set out in the trust instrument. Their decisions are guided by the language you put in place during your lifetime.
Once the grantor dies, the trustee steps into a vital position, often referred to as a fiduciary role. That means they must manage the trust with honesty and loyalty, keeping the devisee’s welfare in mind at all times. Massachusetts law recognizes this responsibility as both serious and enforceable, which is why trustees must stay within the boundaries of what the trust document directs.
Important trustee tasks include:
- Overseeing and safeguarding the trust’s assets
- Ensuring that debts and taxes tied to the trust are handled
- Paying devisees their share according to the trust’s instructions
- Maintaining transparent records and providing regular account statements
Main Steps in Trust Administration After Death in Massachusetts
Administering a trust following the grantor’s passing involves several phases. Each phase helps ensure assets pass smoothly to devisees while also settling outstanding responsibilities.
Notification of Devisees and Heirs
Massachusetts Probate Code section 16061.7 requires a formal notice to all trust devisees and certain relatives (often the grantor’s heirs) soon after the grantor’s death. This notice alerts them that the trust is now in its administration phase and that they have a right to receive a copy of the trust if they request it. Trustees must also include:
- The grantor’s name and trust signing date
- Trustee contact information
- Where the trust will be administered
- A statement explaining how long they have to dispute the trust
Getting the timing right with this notice is key because devisees have limited windows to voice any objections. Failing to issue prompt notifications can cause more legal hurdles down the line.
Asset Inventory and Valuation
The trustee begins by making a thorough list of everything inside the trust. This can include real estate, accounts, and other valuable property. To prepare an accurate inventory, the trustee checks all titles and ensures the items do indeed belong within the trust.
A formal appraisal or valuation of these assets is often needed. A real estate appraiser might provide updated property values, and financial accounts might require statements to reflect balances at the time of the grantor’s death. This inventory process forms the foundation for handling debts, taxes, and distributions.
Debt and Tax Obligations
The trust is generally responsible for certain debts and taxes related to the grantor’s estate, and the trustee must verify that creditors are paid. If the trust is large enough, it might face estate taxes in Massachusetts. Working with professionals, such as accountants or tax advisors, can be helpful to confirm that deadlines are met. This step is vital before any final payouts happen because any overlooked debt or tax can disrupt later actions and even create liabilities for the trustee.
Asset Management and Investment
When the trust calls for ongoing management, the trustee may invest or safeguard assets until distribution. This could mean renting out real property, managing an investment portfolio, or selling assets that no longer match the trust’s objectives. All decisions must align with the trust guidelines while putting the devisees’ best interests first.
Distribution to Devisees
Once debts and taxes have been satisfied, the trustee transfers the assets to the devisees. This transfer might happen all at once or in stages, depending on the trust terms. Some trusts remain in place for many years, especially if they involve ongoing distributions for minors or loved ones who need long-term support.
A short checklist for distribution steps can help:
- Confirm that debts and taxes are complete.
- Confirm the devisee’s details and addresses.
- Document each distribution and get receipts or acknowledgments.
Clear records prevent confusion and reduce the chance of disputes.
Accounting and Record-Keeping
Trustees in Massachusetts must keep devisees informed through accounting reports. Devisees have a right to see how money flows in and out of the trust. An organized record of transactions ensures everyone remains aware of what actions the trustee is taking. This is also a safeguard for the trustee, as it helps reduce doubts about whether they are fulfilling their duties.
Table: Overview of Trust Administration Steps
| Step | Action | Approximate Timing |
| Notification | Notify devisees and heirs about the trust and their right to a copy | Within 60 days of the grantor’s death |
| Inventory & Valuation | Compile a detailed list of trust assets and secure appraisals if needed | Early in the administration process |
| Debt & Tax Handling | Settle outstanding debts and handle state or federal taxes | Before final distributions |
| Distribution | Transfer assets to devisees following trust guidelines | After debts, taxes, and accounting are done |
| Accounting | Share financial reports and transactions with devisees | Regularly until the trust closes |
Trust Continuity and Termination
Some trusts stay active for years after the grantor’s death. This can happen if devisees need steady support or if the trust instructions set age requirements. A trust document might also specify that it terminates once funds are exhausted or certain events occur. In that case, the trustee completes the final accounting and transfers remaining assets to the designated devisees or final recipients. Once the stated conditions have been met, the trust’s purpose comes to an end.
The Importance of a Periodic Trust Review
Life moves fast, and both personal goals and legal guidelines can shift over time. That’s why it’s wise to revisit and update your trust periodically. Marriages, children, and changes in property holdings might lead you to modify the distribution instructions. Reviewing your trust also provides an opportunity to confirm that your chosen trustee is still a good match, and any out-of-date references or details are cleaned up.
Contact Jordan & White, for Assistance with Your Estate Planning Needs
We understand the peace of mind that comes from knowing your trust will be handled with care. Call us at 978-744-2811 or visit our Contact Us page if you would like to set up or revise a trust plan in Massachusetts. Our team takes pride in offering guidance rooted in many years of handling real estate and local estate matters. Talk to us anytime about ways to shield your loved ones and manage your assets now and in the future.