REvocable Trust

[EastWest Gal]

Also, no POA applies once a person is deceased, but there should be an Executor or Executrix.

Does the trust state who is the successor trustee and give directions what to do after both original trustees passed? Or does it just list all three of you as successor trustees? For example, my parents trust listed the successor trustees in order: surviving spouse, then me, then my sister. It also gave instructions to dissolve the trust. The trust had it's own tax ID number and a 1041 was filed each year.

The executor is determined by the will. Did your mom have any assets outside the trust--actually, she did, the IRA. The estate is required to file an estate tax return, and will need its own EIN.

As co-successor trustee, you have a right to a copy of the tax returns and information about the accounts. It sounds like you need a lawyer's advice here, not just an accountant.

I agree with one of the above posts, that the three siblings need to meet, preferably with the accountant, and/or maybe an estate lawyer. No spouses should be there at all. They are not trustees. If DB refuses, get a lawyer.

Other resources that might be helpful:

Nolo press gives good information about trust and estate laws in each state. It will help you figure out how off base DB might be. I needed a local lawyer and a lawyer in CA for my dad's estate. I contacted the bar association and also searched online and ended up with a terrific lawyer in CA.

[pb4uski]

Quote:

Originally Posted by RE2Boys Did you mean doing a 1041 Fiduciary Tax Return? I was able to do my sister's trust tax return using Intuit Online Tax software, I think it cost about $40 last year. Trust terminates in 2015 so only two more returns.

Yes, I meant 1041. A mind fart on my part. Ours is so simple (5 pages - 1041, Sch D and one K-1 and I don't think I'll have Sch D this year) that it probably isn't even worth spending $40 but that is a good thing to know in case I have a year that it is more complicated.

[Corporate ORphan]

Thank you for all your posts. I have reread my mother's trust and I don't see anything about how the three of us should do decide anything. I guess it will be majority rule. I will just have to take my chances with DS. Hopefully, she will remember DB has not be above board all these years and all the hurt from the last three years caused his crazy family. She says she agrees with me about having him produce the documents and dissolve the trust, but who knows what she will actually say when we meet with the accountant this Friday.

DM's will is a hand written notarized piece of paper saying we get it everything. That's all it says.

DB has gotten the new tax number already. I guess he plans to do her tax return and the trust's tax return this year.

I now need to organize all my thoughts drifting around my head and put them on paper. I have an MBA as well as MS in Food Science but all this hurts my head.

[hesperus]

Reading this thread brought back memories of many bad experiences between my sister and I when our last parent died, who left us several trusts, a will, and a mish mash of roles (trustees, co trustees, co executors). There were some early problems with her, as in her self dealing some significant assets, trying to hide it, but getting caught through my accounting reviews. It created a toxic environment from that point on. It was a tough wake up call when I realized that when it comes to money, some people lose any integrity and are willing to destroy relationships in the pursuit of it. It was one of the most stressful times of my life, dealing with a 'family' member who was dishonest. Ultimately my goal was to as quickly and efficiently as possible distribute all assets between us and clear my life of this sibling. We did that, and I have not yet looked back.

[Corporate ORphan]

The meeting with the accountant is Friday and DB sends email today that all three of us need to go next week to PNC bank to close out an IRA (worth $250), a checking account and cd that are in the trust. Seems they are in a hurry for us to do it. Of course, DS sister sends an email saying when she is available and would he like her to make the appointment!!!!!!!!!!!!!!

DH and I just talked to her this morning about what we need from the accountant and she STILL is bending over backwards to help DB. DS has ADD and is the middle child so she is "over eager" to please him.

Can the two of them close the account(s) at PNC without me? I was planning on ignoring the emails and just talk about it on Friday.

[pb4uski]

It depends on how the accounts are titled, what the trust document says and if PNC is awake, but they probably can. I would think that in most cases 2 of 3 co-trustees would be sufficient to act (I know it would be for our trust).

Now while they can probably close the account they still would have a fiduciary duty to distribute any proceeds consistent with the trust provisions, but as to what they would actually do, who knows.

But it sounds like the meeting with the accountant is in a couple days and before you go to the bank next week so can't you all discuss it when you meet with the accountant?

[MooreBonds]

Quote:

Originally Posted by Corporate ORphan The meeting with the accountant is Friday and DB sends email today that all three of us need to go next week to PNC bank to close out an IRA (worth $250), a checking account and cd that are in the trust. Seems they are in a hurry for us to do it. Of course, DS sister sends an email saying when she is available and would he like her to make the appointment!!!!!!!!!!!!!!

Call him on it! Ask him why it has to happen so quickly. Demand a summary of all assets in the estate. Also, is it just $250? Seems a little fishy to have an IRA with such a low balance, given RMDs. If your DB was in charge of her investments, why did he leave such a small IRA balance? Were there withdrawals of just $15 a year? You can look at your mother's tax return from last year to see what her IRA withdrawals were, since the 1040 has a dedicated line for retirement account withdrawals. If she had IRA withdrawals in the thousands in 2013, then something doesn't quite sound right....give you even more reason to demand a copy of checking account statements for the entire year.

If your DB balks and says "why do you want them, don't you trust me?" simply say "Why are you resisting to give them to me, have something to hide? I have every right to them as a co-executor".

[robertf57]

Quote:

Originally Posted by MooreBonds Call him on it! Ask him why it has to happen so quickly. Demand a summary of all assets in the estate. Also, is it just $250? Seems a little fishy to have an IRA with such a low balance, given RMDs. If your DB was in charge of her investments, why did he leave such a small IRA balance? Were there withdrawals of just $15 a year? You can look at your mother's tax return from last year to see what her IRA withdrawals were, since the 1040 has a dedicated line for retirement account withdrawals. If she had IRA withdrawals in the thousands in 2013, then something doesn't quite sound right....give you even more reason to demand a copy of checking account statements for the entire year. If your DB balks and says "why do you want them, don't you trust me?" simply say "Why are you resisting to give them to me, have something to hide? I have every right to them as a co-executor".

+1 May need to work on the DS a bit. Don't let her drink the Kool-aid

[Corporate ORphan]

Called DS. She is now on board with me and sent an email to DB that we should wait until after talking with the accountant. She was confused and thought it had to do with the RMD from the inherited IRA. DB never replied. His wife probably won't let him (she admitted she reads his email.)

I am not looking forward to tomorrow.

[Corporate ORphan]

Friday wasn't as bad as I thought it would be. I didn't think the tax accountant was that great but DB and DS co-operated. DB had a spreadsheet of her assets with him and gave us copies. He also promised three years of tax returns.

Turns out mom has some I-Bonds that DB doesn't know if they are in the name of the trust or in her name. He is going to check. Any one know if you can change an I-Bond to be in one of our names? The interest rates are better than anything we can get now. They don't mature until 2035.

Also, US Bank can't find the paperwork with the beneficiary listing on her IRA there and neither can DB (though Mom kept everything.) It's an old IRA so the original bank is like three banks ago. Any ideas on how to find it?

Thanks again!

[nun]

I'm not really sure the revocable trusts are the way to go if your estate is below the inheritance tax limits. Retirement assets can be easily and quickly transferred on your death by filling out the beneficiary information on the accounts and a well written will with a single executor takes care of the balance of the estate. Having co-executors and trustees seems to just complicate matters. Probate might take some time and costs, but it makes sure the estate is wound up correctly.

[pb4uski]

Quote:

Originally Posted by Corporate ORphan .....Turns out mom has some I-Bonds that DB doesn't know if they are in the name of the trust or in her name. He is going to check. Any one know if you can change an I-Bond to be in one of our names? The interest rates are better than anything we can get now. They don't mature until 2035....

I researched with with my great-aunt's savings bonds. I could not do it in my case, but I think it is probably possible in your case. Worth checking into anyway.

Here is a place to start. https://www.treasurydirect.gov/indiv...eedeath.htm#no

[Corporate ORphan]

Anyone know if we do cash in the I Bonds, how are the taxes on the interest dealt with? The accountant told us the cost basis on the stocks and mutual funds is based on the time of her death and we had 9 months to cash everything out. WE didn't discuss the I Bonds. Are they dealt with the same way or do we owe taxes on our share if they are in the trust?

He did say anything the trust would owe taxes on, we would so I guess that means we would owe taxes on the interest paid on the I Bonds if we cash them out?

[RE2Boys]

Quote:

Originally Posted by Corporate ORphan Anyone know if we do cash in the I Bonds, how are the taxes on the interest dealt with? The accountant told us the cost basis on the stocks and mutual funds is based on the time of her death and we had 9 months to cash everything out. WE didn't discuss the I Bonds. Are they dealt with the same way or do we owe taxes on our share if they are in the trust? He did say anything the trust would owe taxes on, we would so I guess that means we would owe taxes on the interest paid on the I Bonds if we cash them out?

If the I bonds were owned by you mother (not titled to the trust) the executor/personal representative has the option of reporting, on the descedent's final tax return, all interest accrued to the date of death. Whoever then gets the bonds would only report interest earned from that date forward. See IRS Pub 550 for details.

Or the inheritor would pay taxes on the full interest earned on these bonds until redeemed. Depends on who would be in the lower tax bracket.

If your name or your siblings names are on the bonds, I believe you can just keep them until maturity.