I’ve got the co-trustee blues

[Janderso]

My mother and I are co-trustees of my parents trust.
My mother passed away so I’m the successor trustee.
When I went to the attorney to provide a death certificate and to initiate the legal termination-distribution of the trust, I heard an hour of legal speak.
So I go online to determine if we even need a lawyer? Everything is written by lawyers.
My mother’s remaining assets are in securities and bonds, mutual funds etc.
No real estate.
I’m a beneficiary along with my brother. That’s it. 50-50 are the instructions in the trust. It’s all laid out.
I’m asking my friends if they have any advise for this lonely old trustee.
All the assets are in one Edward Jones account. I’ve asked our representative to create an account for my brother in effort to split the shares and hold open a money market for any unknown expenses. The attorney suggests waiting 120 days as a discovery period.
I’ve paid all bills.
Thanks for any advice or experience you can share.
My gut says, I don’t need an attorney.

 

[Aukai]

My mother had an undiscovered separate account, as the trustee you will be, and should have all mail forwarded to you. I kept getting mail that I thought was a duplicate of what was already in the estate, and did not open it for some time. It was a totally different account that I was able to direct into the trust. You will be flooded with mail for awhile.

 

[Papa Charlie]

This is something that my wife and I have to look into. We don't have any children. If anything happens to me, my wife is the beneficary of all my accounts. But we need to set something up so that if something happens to both of us, all our assests are liquidated and split between our three nieces and nephew.

 

[Aaron_W]

Other than 2 storage units of "treasures" the only significant asset left by my mother was a Charles Schwab account and a few thousand dollars death benefit from her pension. My brother and I were listed as the beneficiaries on the CS account.
When I went to the lawyer who had been helping me during the conservatorship, he went over what we had, saw that the account was the only significant dollar value, saw that my brother and I were the listed beneficiaries, told me the easiest way to divide the account, and bid me a good day, billed for about 10 minutes work.

Went to Charles Schwab with the death certificate, they had my my brother and I create new accounts, then split her account into the new accounts and it was done.

I had been handling all of her bills so there were no outstanding debts. Over the next couple of months we did receive several smallish life insurance policies that I had known nothing about.

This is something that my wife and I have to look into. We don't have any children. If anything happens to me, my wife is the beneficary of all my accounts. But we need to set something up so that if something happens to both of us, all our assests are liquidated and split between our three nieces and nephew.

If you don't want a significant amount to go to the state and lawyers set up a trust. Even when there is only one relative for the assets to go to a sizable amount of the estate will get siphoned off in fees without a will or trust. Not terribly expensive to have a simple trust drawn up, I think $1000-1500 is typical.

 

[FOMOGO]

Doing my dad's and brothers estates, just about put me into the ground beside them. The process had already been started, and lawyer in place when I took over after my brothers death. It turned my mild distaste for attorney's, into full blown hatred. Avoid them entirely, if at all possible. Mike

 

[rabler]

One component is how cooperative your brother will be. My experience suggests that the more friction between the beneficiaries, the more the attorneys benefit.

Different states have different policies. But I think the most important thing you can do for yourself is to keep very careful records of everything. In addition to dividing the assets, between you and your brother, you have a third category, expenses in settling the estate, which come out of the estate.

editted to add: Forgive me if I'm stating the obvious ...

 

[Beckerkumm]

I'm a CPA of 45 years and have been both a trustee and Personal Rep for estates many times. There is no tax difference between a Revocable trust and an estate. the trust does does avoid probate which may or may not be a big deal depending on the jurisdiction. If there are issues in the family or among the beneficiaries, I prefer being PR in an estate as the judge signs off on my decisions and requires a complete accounting. Sometimes it is good to have a backup when the beneficiaries are idiots.

Generally I go to cash rather than split up assets if possible. It is often difficult to split each stock evenly and since date of death and date of distribution values are different, there is difficulty in truing up beneficiaries unless all is in cash. The job of the trustee in winding up a trust is to minimize risk. If the market drops like in March of 2020, you don't need people questioning why you held securities. Whether you need an attorney for more than just a consultation depends on the assets in the trust and the potential for beneficiaries to make your life miserable. Dave

 

[Janderso]

Some valuable information here.
The attorney did say, ask your Edward Jones rep. to open an account for your brother, splitting the shares , in kind, is the legal way to go. He can then transfer to Les Schwab, cash out, reinvest or do whatever he wants. This is already set up as of yesterday.
Regarding value, there is a small IRA that was combined from my Dad's IRA to my Mom's. Both her IRA account and the trust account are held at Edward Jones. The estate is in excess of half a million, way below the death tax. I think it's 11.8 million?? No worries there.

It appears the only things to worry about is the relationship with my brother and determining any unpaid bills.
I've been rereading the trust documents this morning. My instructions are pretty clear.

A 1099 went to the Franchise Tax board for some dividends that were reinvested back in 2019.
Our tax guy said her income is so low she doesn't need to file after he did her 2018 taxes, so we didn't.
The 1099 was for less than $2,000. Tax on that would be approximately $200 for state. Haven't heard from the feds.
I meet with our tax guy on Friday to get some advise moving forward.

I think it would be prudent to hold about $20,000-$30,000 in limbo until we get all this tax stuff worked out.
Thanks for your help,
I'm feeling better about the no attorney needed idea.

 

[projectnut]

There are many forms of trusts and each have their own advantages and disadvantages. We've been administrators of a few over the years and they've generally been an expensive PITA. While they do direct specific money amounts to the beneficiaries they are expensive to maintain. If there are investments and properties involved they require annual accounting and have tax obligations. The tax man gets paid first, the lawyers second, the accountants third, and anything that's left over is split by the beneficiaries.

We had a a relative investing with Edward Jones. There wasn't a great deal of money involved, but over the years the real winner was the local Edward Jones investor not the designated beneficiaries. The beneficiaries did open temporary accounts there to transfer the money, but closed them as soon as possible. The fees in addition to the buying and selling commissions were outrageous.

If you're at all financially savvy once the money is distributed move it to a TD Watehouse or similar style account. You'll have to personally make more financial decisions, but won't loose money on fees and commissions. Depending on the fee and commission structure full service providers like Edward Jones can cost 10% or more.

In addition to the fees and commissions the amount of money involved also has implications. The smaller amount of money involved the fewer services are available. Most inverting companies have break points that determine the level of service. Less than $100,000.00 gets almost no service, $500,000.00 gets limited service, $1,000,000. gets semi full service, and $5,000,000.00 gets full service

 

[Janderso]

move it to a TD Watehouse or similar style account

Is that Ameritrade? I did a Google for TD Waterhouse and got A Canadian reference.
When my Dad was still with us he had 100% of his investments in Ameritrade =all securities.
He was losing his cognitive abilities and mom couldn't do anything online. She asked me to help her move the money to a local firm.
It took me several phone calls to get the right people. The sales guys said they would do this or that and never did a thing.
I was not impressed. I'm sure their fees are much less, my dad hated paying for any service.
I just don't know enough to handle our own investments. I trust a professional and know I'm gonna have to pay for their advise.
I did set up an E-trade account. Makes it easy to buy and sell stocks at less than $7 for each transaction.