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Simple English definitions for legal terms
trust administration
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A quick definition of trust administration:
Trust administration is the process of managing a trust, which is a legal arrangement where someone (the trustor) gives their assets to someone else (the trustee) to manage for the benefit of others (the beneficiaries). The trustee has a responsibility to follow the trustor's wishes and manage the assets, make investments, pay taxes, and distribute the assets to the beneficiaries. This can be complicated and may require help from lawyers, accountants, and other professionals. After the trustor dies, the trustee must also make sure that all the necessary paperwork is filed and any debts are paid off.
A more thorough explanation:
Trust administration refers to the management of a trust's assets, distributions, and filings. It involves complex and time-sensitive tasks that are carried out by a trustee who has fiduciary duties to follow the trustor's intentions and manage investments and taxes.
For example, if a wealthy individual creates a trust to provide for their children's education, the trustee would be responsible for managing the trust's investments, making distributions to pay for the children's education, and filing tax returns on behalf of the trust.
Trust administration can be very complex when the trust contains different types of investments and beneficiaries. In such cases, the trustee may need to seek legal, financial, and administrative assistance to manage the trust effectively.
After the trustor's death, the trustee must make appropriate filings and pay off any financial obligations of the trust. For instance, if the trustor had outstanding debts, the trustee would be responsible for paying them off using the trust's assets.