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What Is Trust Settlement?

January 1, 2021

Trust settlement helps to coordinate a smooth transfer of assets to your heirs and beneficiaries according to your wishes.
While your attorney aims to make this process as efficient as possible when designing your estate plan, there is still work to be done, including:

  • Registering the trust with the IRS (if it becomes irrevocable at death)
  • Completing an inventory of the trust assets
  • Obtaining a date-of-death value of trust assets for estate tax and basis step-up purposes
  • Determining whether assets held outside the trust must be administered through a probate proceeding
  • Opening a probate estate, if necessary, for assets held outside the trust
  • Notifying potential creditors of their right to make a claim against the trust
  • Evaluating creditors’ claims after the expiration of the non-claims period and paying legitimate claims
  • Filing income tax returns (and estate tax returns, if necessary) for the decedent and the trust(s)
  • Transferring assets at the time and in the matter dictated by the trust and pursuant to legal requirements, including the creation of sub-trusts for beneficiaries, if necessary
  • Creating the trust accounting and coordinating beneficiary approval
  • Distributing the remaining trust assets to beneficiaries

Whether or not your beneficiary is a client of our firm, we are here to help with the funding and administration of their trust. Schedule a complimentary, no-obligation consultation and learn more about how Creative Planning can help you achieve your legacy goals.

This commentary is provided for general information purposes only, should not be construed as investment, tax or legal advice, and does not constitute an attorney/client relationship. Past performance of any market results is no assurance of future performance. The information contained herein has been obtained from sources deemed reliable but is not guaranteed.


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