Trusts Attorney in Oakland, California

When it comes to estate planning, trusts are often central to managing and distributing assets according to a person’s wishes. Whether you’re looking to establish a trust, administer one, or resolve disputes related to a trust, seeking legal representation can provide clarity and guidance. 

Trusts offer several benefits, including helping to avoid probate, offering privacy, and providing for minor children or beneficiaries with special needs. However, setting up or managing a trust can present legal challenges without the right legal support. At the Law Offices Of Gary R. Kershner, I help those in California through the process of setting up a trust.

In California, where trust laws can differ from other states, having an attorney who understands the nuances of local laws and regulations is important. With the help of skilled legal representation, you can check that your trust is set up correctly, administered properly, and disputes are handled efficiently.

If you need to set up a trust or would like to know more about why you might want one, contact the Law Offices of Gary R. Kershner today.

What Is a Trust and Why Should You Consider One?

A trust is a legal arrangement where one party (the trustor) transfers assets to another party (the trustee) to hold for the benefit of a third party (the beneficiary). Trusts are often used in estate planning to manage and protect assets. One of the primary advantages of a trust is its ability to avoid probate—the legal process that distributes a deceased person's assets. 

By bypassing probate, trusts help streamline the asset distribution process and often allow heirs to access assets more quickly. When it comes to estate planning in California, a trust can also protect assets from creditors and may help minimize estate taxes. 

Some types of trusts, like revocable living trusts, can be altered or canceled during the trustor’s lifetime, while irrevocable trusts are permanent once established. Understanding which type of trust is most appropriate for your situation is an important part of the planning process.

Types of Trusts

There are several types of trusts that individuals use for estate planning in California. Each type serves a different purpose depending on your needs. These include:

• Revocable living trusts: These trusts are created during the trustor’s lifetime and can be modified or revoked at any time. They provide flexibility and control over assets, making them a common choice for individuals wanting to maintain control while avoiding probate.

• Irrevocable trusts: Once established, these trusts cannot be modified or dissolved without the beneficiary’s consent. Irrevocable trusts are often used for asset protection or tax planning, as they remove assets from the trustor's estate.

• Testamentary trusts: These trusts are created through a will and only come into effect after the trustor’s death. They allow for the distribution of assets according to specific instructions and can help manage assets for minor children or beneficiaries who may not be capable of managing their own inheritance.

• Charitable trusts: These are set up to benefit a charity or nonprofit organization. Charitable remainder trusts and charitable lead trusts are common options for those interested in both philanthropy and tax benefits.

• Special needs trusts: If you have a family member with special needs, this type of trust allows you to provide financial support without disqualifying them from government benefits like Medicaid or SSI.

• Spendthrift trusts: These trusts are designed to protect beneficiaries from creditors. The trustee controls the distribution of funds, helping see that the assets are used appropriately.

Each of these trust types has unique features, and deciding which one to create requires thoughtful planning and consideration of your personal goals.

Once you’ve determined which type of trust is necessary for your situation, it’s time to familiarize yourself with the process of establishing a trust.

Establishing a Trust

The process of creating a trust can be more involved than creating a will. California law requires specific steps to make sure that a trust is valid and enforceable. These steps typically include:

1. Drafting the Trust Document: A trust must be written and include key provisions that outline how the trust will operate, how assets will be distributed, and who will act as the trustee.

2. Designating a Trustee: The trustor must choose a trustee, who will be responsible for managing the assets within the trust according to the terms laid out in the trust document. The trustee can be a person, an institution, or a trust company.

3. Transferring Assets: The trustor must transfer ownership of assets into the trust. This includes real property, bank accounts, investments, and personal property. Properly transferring assets is crucial to checking that the trust functions as intended.

4. Executing the Trust Document: The trust must be signed and notarized according to California law. While a trust does not require witnesses, notarization can add an additional layer of legal protection.

5. Reviewing and Updating the Trust: Over time, as family dynamics and financial situations change, it’s important to review and update the trust. Legal representation can help with amendments or trust restatements to reflect current wishes.

Legal representation during this process can help make sure that all steps are followed correctly. Mistakes made during the creation or execution of a trust can lead to unintended consequences, such as unnecessary taxes or challenges to the validity of the trust.

Once a trust is established, the next step is administering it.

Administering a Trust

Administering a trust involves managing the assets, making distributions to beneficiaries, and checking that the trust operates according to the trustor’s wishes. 

This can be an overwhelming task for those unfamiliar with the process. Trustees have a fiduciary duty to act in the best interest of the beneficiaries and to manage the trust assets prudently. Key responsibilities of a trustee include:

• Managing trust assets: Trustees must handle investments, real estate, or any other property placed in the trust. This includes making decisions on how to maintain, sell, or invest assets.

• Distributing assets: Trustees must distribute assets to beneficiaries according to the terms of the trust. This can be done outright or through structured distributions, depending on the instructions laid out in the trust.

• Paying debts and taxes: A trustee must settle any outstanding debts and taxes owed by the trust before distributing assets to beneficiaries.

• Maintaining records: Trustees must keep accurate and thorough records of the trust’s activities. These records are essential for transparency and can protect the trustee from future liability.

Legal representation during trust administration can help prevent mistakes and make sure that all duties are carried out properly. As a qualified attorney, I can also help handle the tax implications of trust distributions and any other legal requirements that may arise, including the management of disputes.

Trust Disputes

Trust disputes can arise for various reasons. Beneficiaries might challenge the validity of a trust, claim that a trustee isn’t fulfilling their duties, or question the terms of the trust itself. 

In California, trust disputes often involve issues related to the validity of the trust document, disagreements over the interpretation of the trust’s provisions, or claims of undue influence or fraud. Common reasons for trust disputes include:

• Allegations of fraud or undue influence: If a beneficiary believes that the trustor was coerced or influenced inappropriately when creating the trust, they may challenge the trust’s validity.

• Breach of fiduciary duty: If a trustee fails to act in the best interest of the beneficiaries or doesn’t adhere to the terms of the trust, beneficiaries may take legal action to address the breach.

• Misinterpretation of the trust’s terms: Disagreements about how assets should be distributed can lead to disputes between beneficiaries or between a trustee and beneficiaries.

• Challenges to trust validity: Disputes over whether a trust was created validly, whether it meets legal requirements, or if a trustor lacked the mental capacity to establish a trust.

Handling trust disputes can be difficult and emotionally charged, but having an attorney with experience in handling trust litigation can help resolve these conflicts in a fair and efficient manner.