Does a Revocable Trust Need an Executor?
An executor is a person appointed to administer the estate of a decedent that has left a last will and testament. Property held in trust has a trustee with a fiduciary duty to administer the trust in accordance with the trust terms. Trustee and executor are not interchangeable terms and even though a trustee and executor can be the same person or company, they are separate and distinct legal appointments. A revocable trust does not have an executor, only a trustee.
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Duty of an Executor
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The executor of a will is a formal appointment by the court and given the authority to act on behalf of the estate. An executor has many responsibilities which include payment of any outstanding debts such as last illness expenses, collecting and protecting estate assets and paying any taxes due. The primary duty of the executor is to ensure compliance with the terms of the last will and testament and to ultimately distribute the property to the beneficiaries of the estate.
Duty of a Trustee
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A revocable trust does not appoint an executor; the appointment has no meaning in trust terms. A revocable trust will have a trustee with a duty to manage trust property in accordance with the terms of the trust. A trustee does not have authority to handle any property not titled in the trust name which is why an executor appointment occurs for the estate. The duties of an executor terminate at estate closure when the court discharges the executor but a trustee continues in office until the trust terminates under terms stated in the trust agreement.
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Will and Trust
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A person with a revocable trust will still need a last will and testament and will have an executor appointed to settle the estate. The trustee of the revocable trust and the executor of the last will and testament can be the same person, but only the office of executor will require formal appointment by the court. A common technique is to have a will drafted as a pour over will, where all of the assets of the estate distribute into the trust upon closure of the estate.
Seek Professional Help
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Drafting of a last will and testament and trust are complicated legal matters and vary by state law. Changes in the federal tax code also significantly impact wills and trusts so it is sensible to seek the advice of a professional trust and probate lawyer to draft these documents. Trust, probate and tax law change constantly and the advice of a professional that stays current with these changes is practical.
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