Trust administration is the process where the successor trustee pays a deceased person’s taxes and debts and then transfers the remaining trust assets to the beneficiaries according to the instructions provided in the trust document. Unlike probate, there is no court supervision, there is no bond issued, and nothing has to be published in the local newspaper.
An earlier article discussed probate costs in Florida. Many people set up a living trust in order to avoid probate costs. However, there are still some costs associated with trust administration.
Filing fee for Notice of Trust
The filing fee varies by county. Currently, Pinellas County charges $41 for a Notice of Trust. This is significantly less than the current filing fee for a formal probate.
The IRS doesn’t care if there is a probate or a trust administration. Either way tax returns need to be filed. If the trust document states that the assets will stay in the trust and be distributed over time, there will be trust tax returns due every year. The trust assets may be used to pay the tax preparer.
Florida law requires that the trustee provide an accounting to the beneficiaries at least annually, unless the beneficiaries sign a written waiver. If the beneficiaries do not sign a written waiver, the trust assets may be used to pay the cost of preparing the formal accounting.
Florida law states that it is presumed reasonable for attorneys to charge up to 2.25% of the value of the trust assets for ordinary services. In addition, the attorney’s fee may be more if there are extraordinary services provided. Extraordinary services include contested trusts, disputes or litigation, preparing a federal estate tax return, the sale of real estate, and carrying on the deceased’s business.
Reduced Attorney’s fees for Peace of Mind Members
For members of our estate planning maintenance program, Peace of Mind A Life Plan for Everyone®, we are keeping the trust up to date every year and we know where all the trust assets are. Therefore, we are able to offer a reduced trust settlement fee for beneficiaries of Peace of Mind members.
This article is for information only and is not intended to provide legal advice. The costs described in this article can change. If you are a successor trustee and want to know the current trust administration costs, call us at 813-852-6500 to schedule a free consultation with a trust administration attorney.