What is the proper/legal way to divide up the cash in an estate/trust?

UPDATED: Nov 16, 2011

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What is the proper/legal way to divide up the cash in an estate/trust?

Mom passed away recently and had minimal estate, house upside down (which we are letting foreclose, reverse mortgage) and 60K in cash. After the house forecloses, I as the trustee will divide the cash between the 3 of us kids per the trust (we all get along, no issues there). I was told by a friend that I need affidavits/some type of filing with the state to do this legally. My CPA will handle her final tax return, can’t I just write 3 checks to the 3 of us and call it final?

Asked on November 16, 2011 under Estate Planning, California


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

If your mother passed away with a relatively small estate subject to a trust and not a Will and you are the trustee, you need to prepare an inventory of the estate and an accounting as to the bills that will be paid and those that will not.

After you come up with the net amount of the estate, you need to prepare an allocation of what each designate beneficiary will receive and have him or her sign their approval. Once done, you simply issue checks to all the benefiaries after the final tax returns are completed (or if you want to do the distribution earlier, make sure you have enough held back to pay the taxes).

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