When the second (i.e. surviving) spouse dies, the responsibility for settling the estate falls to the successor trustee who is named in the trust. Very often the successor trustee is one of the adult children. When any close friend dies, it is a difficult time. This is especially true if the deceased is your parent. This is not the time you want to have a lot of financial stress and a living trust helps to simplify the process. The good news is that you can take time to grieve before you begin to settle the estate.
If you have a trust, and all the assets are properly titled in the trust, there is no need to go through probate. When you are ready to start settling the estate you should decide how much you want to handle on your own and how much you want to delegate to others, such as an estate planning attorney or a CPA. It is best to contact an estate planning attorney at the outset to discuss the things that need to be done. Most attorneys will agree to an initial meeting with you, at no charge, to discuss the work needed to settle the estate,
On the date of death of the second spouse, the entire trust becomes irrevocable. Whatever the decedents specified in the trust become the “marching orders” for the successor trustee. The first task for the successor trustee (per Probate Code §16061.7) is formal notification of all heirs and beneficiaries of the death. The successor trustee should pay all the current bills, inform financial institutions of the death and file Affidavits of Death of Trustee with the county recorder in the county where the decedent’s home is located. There are also others to contact including insurance companies, the Social Security Administration, the Department of Motor Vehicles (DMV) and possibly the Veteran’s Administration (VA). After you find all the assets, they should be valued as of the date of death and distributed in accordance with the terms of the trust.
One urgent item is to quickly determine if any federal estate taxes are due. These federal estate taxes (also known as death taxes) are due in cash nine months after the death of the surviving spouse! You will also need to keep good records of all estate transactions to be able to produce the accountings required by law and in accordance with the terms of the trust.
The successor trustee’s responsibilities after the death of the surviving spouse are very similar to what is required after the first spouse dies.
(See Estate Administration Check list.)
Not every item is required in every case. Your estate planning attorney can work through this list with you.