Being party to a trust in Woodland Hills can be a nerve-wracking proposition given that your interest in it are wholly impacted by the actions of another. While you of course want to trust that the settlor of the trust chose a trustee that he or she believed and had faith in, the idea of the trustee working with absolute impunity may seem unsettling to you. Several in your position have come to us here at The Law Offices of Alice A. Salvo with the same concerns, wanting to know what standard of accountability a trustee is held to and what liability he or she assumes in he or she fails in his or her duties.
Helping someone through their final days in Woodland Hills can be a monumental task. The difficulty of such an endeavor may be what makes it understandable why so many seem to favor those that they are closest to during their twilight years in their estate planning. However, others who might otherwise be party to an estate may view their interests as being impacted by the actions of those who were consistently around a decedent until his or her end. That impact may could lead to accusations of undue influence.
Different areas of the law may intersect in certain cases. However, two that you might not assume to have much relevance to each other are estate planning and family law. You might be surprised to learn how often these different legal disciplines go hand-in-hand. Many who are beneficiaries to trusts often come to us here at The Law Offices of Alice A. Salvo wondering if their interests can be made available to creditors. The answer to that question in yes (in certain situations).
The basic premise of a trust is fairly straightforward: A person (the settlor) asks another (the trustee) to retain and manage an asset for the benefit of yet another (a beneficiary). Given the simplicity of that explanation, one might think that a trust is little more than a promise made between people in Woodland Hills. This may prompt the question of whether or not one can transfer assets through an oral trust.
Naming a reliable trustee may be the most important decision that a person in Woodland Hills can make after deciding to establish a trust in the first place. That trustee will be endowed with power to oversee much of the management and administration of the trust’s assets and properties. Oftentimes, as a way of balancing out that power, co-trustees may be chosen instead. In such a case, each co-trustee must typically agree on actions that affect the trust. However, that is not to say that there will not be disagreements and disputes amongst those that hold this role.
If you have been asked to serve as a trustee of a trust account by a family member or friend in the San Fernando Valley, your first concern may be what sort of consequences you could face should you commit an error during the execution of your duties. Many of those that we here at The Law Offices of Alice A. Salvo have worked with who have been named trustees come into the role without any related experience. Fortunately, the California Trust Code recognizes that there may be differences between personal liability and alleged incorrect action performed while fulfilling the role of a trustee.
One of the main advantages that many often cite when extolling the benefits of trusts is the privacy that they afford. Woodland Hills residents can place estate property and assets in trusts without having them become a matter of public record. According to the American Bar Association, one can even protect the identities of his or her beneficiaries through a trust. All he or she must do is have their estates pass into trusts via their wills. Yet the privacy protections offered to a trust settlor and his or her beneficiaries may not necessarily extend to a trustee.
When a settlor entrusts a trustee to manage assets for the benefit of designated beneficiaries in Woodland Hills, that person is placing a great deal of faith in the trustee’s abilities to accomplish his or her aims. Oftentimes, the person or party chosen as the trustee may not be up to the task. The question then becomes whether or not his or her shortcomings constitute a breach of trust.
Those in Woodland Hills who have assets they would like to be managed for the benefit of others may find a trust to be an effective tool at doing so. The same may be said for people who wish to use their personal assets to benefit a favorite charity. Those who would like their trust’s property to do both may be able to do so through a split-interest trust. The Internal Revenue Service defines a split-interest trust as one for which a portion was allowed a charitable deduction, while the remainder may be subject to the same tax requirements as a private foundation.
When researching the topics of trusts and trust administration, Woodland Hills residents may likely hear the terms “principal” and “income” thrown around quite a bit. Understanding what each of these words mean in relation to a trust as well as the differences between them may be vital to the success of a trust as being a source of revenue for its beneficiaries. Knowing such information may also greatly help a trustee as he or she works to allocate a trust’s assets correctly.