Revocable Living Trust Administration Attorney Fees

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Topic Author
lgb
Posts: 103
Joined: Fri Mar 01, 2019 9:46 am

Revocable Living Trust Administration Attorney Fees

Post by lgb »

Hey everyone!

Trying to get an idea of what to expect for Attorney costs to get involved in administering a Revocable Living Trust from a deceased parent. The will is pretty simple (uncomplicated) and just has all the assets able to be distributed to the remaining siblings evenly. Trust was created to help avoid assets going through the state probate process.

The main financial assets (retirement investment accounts and Trust investment accounts) are part of the Trust, paid for house is named to the Trust, one Sibling is named on Bank account to access bank funds, tangible assets are already mostly divided up and donated, or sold and being kept track of, there is a car that is Transfer of Death to one sibling, but they agree that the value of this should be split evenly, unless they were to decide to keep it and just reduce their portion of inheritance accordingly.

Otherwise there isn't much contention with the family in this process. (contesting of things etc...)

Question is what should this roughly cost?
It seems we already have a mix of:
-Per Hour fee of $435/hour from Attorney that wrote up the Will/Trust but with no estimation given of how many hours could be needed (will advise once we meet - seems like they should know roughly what this costs if an uncomplicated scenario, if things titled properly)
-Someone else says they charge $295/hour and would review the existing Trust/Will documents and if it all flows through the Trust and doesn't need Probate they'd charge $1500 to $2000 to review existing Will and Trust information, make sure we are doing things properly and what to do, would do the paperwork to notify beneficiaries - and would charge separately if things need to go through actual state probate, would be available to discuss and help map out our steps of what to do, and would let us do things if we want.
-Another option of paying a flat fee of $5,750 based on the amount of Assets involved (under 1 Million or so with House/Investments/Cash). Where I believe they would just handle everything and address any questions we have when needed.

Seems we haven't gotten the option yet of someone charging a percentage of the Assets at varying percentages - (which seems like the most ridiculous option - but seems like the other option of costs from attorneys that could be out there - kind of like the Financial advisor could charge for AUM (assets under management) I guess..)

What is reasonable here as far as costs??

Anythings to be aware of in this scenario - surely we can't be the only ones to have gone through this!??

Just looking for others with experience going through that previously or presently!
bsteiner
Posts: 5393
Joined: Sat Oct 20, 2012 9:39 pm
Location: NYC/NJ/FL

Re: Revocable Living Trust Administration Attorney Fees

Post by bsteiner »

Each estate is different. We've had small estates that were difficult and large estates that were simple. Often most of it is simple but there's something that's difficult.
cjclueless
Posts: 35
Joined: Fri Dec 06, 2013 12:18 pm

Re: Revocable Living Trust Administration Attorney Fees

Post by cjclueless »

This could indeed be a 'none of the above' answer. You are fortunate in that it appears that all beneficiaries are in harmony as to equitable distribution. In my experience as personal rep/trustee I used an estate attorney to confirm that indeed the trust says what I thought it said (e.g. all assets distributed equally free of trust [right or wrong!]). The estate attorney paralegal also completed the paperwork to file the will with the county, but the estate itself was not probated as such since all assets were in the trust. All this for about one hour's billing. Your state may of course have different rules.

Nolo's "How to manage a loved one's estate/trust" (or something to that effect) was a good source as well.

At that point, the trustee will want to tally the various asset pools -- tax deferred, taxable with step up, real estate, etc. and with good communication with the beneficiaries determine how they are divided. If in fact the trust was the beneficiary of the retirement accounts that may introduce a wrinkle whereby subsequent beneficiary RMDs are based on the age of the eldest beneficiary. Bsteiner is of course the resident expert on that. Note that if the death occurred after 12/31/19, the compressed stretch rules are in play for the beneficiaries.

In theory the trustee would provide change of ownership, death cert, and letter of instruction to the asset custodians to divide each pool as agreed. Each beneficiary would have individual accounts established at the custodian which they can subsequently liquidate or move as desired.

Since at least for less complex estates the PR/trustee has to do a lot of the legwork anyway, I didn't see much need for legal help. That said, I did find it beneficial to have some accounting help with final personal return and one-time trust tax return come that time.
RudyS
Posts: 2063
Joined: Tue Oct 27, 2015 10:11 am

Re: Revocable Living Trust Administration Attorney Fees

Post by RudyS »

IANAL, but I have a revocable living trust, and once I'm deceased, I understand it becomes an irrevocable trust.
Gill
Posts: 6959
Joined: Sun Mar 04, 2007 8:38 pm
Location: Florida

Re: Revocable Living Trust Administration Attorney Fees

Post by Gill »

RudyS wrote: Tue Feb 04, 2020 3:58 pm IANAL, but I have a revocable living trust, and once I'm deceased, I understand it becomes an irrevocable trust.
That's by definition because you're no longer around to revoke it. :happy
Gill
Cost basis is redundant. One has a basis in an investment | One advises and gives advice | One should follow the principle of investing one's principal
Topic Author
lgb
Posts: 103
Joined: Fri Mar 01, 2019 9:46 am

Re: Revocable Living Trust Administration Attorney Fees

Post by lgb »

Thanks cjclueless!! Great reply!

Very helpful!

Yes the Will seems to be a pour over will that dumps all assets into the Revocable Living Trust if they aren't already in the Trust. You're correct on the RMD concern - and the death was in 2019 so the belief is that things are not subject to the new rules in 2020 that would force the RMD's to happen over a 10 year period vs. over the lifetimes of the beneficiaries.

Thanks for the tip on the book, have gotten it and it is a wealth of information that everyone should have going through this for certain!

I think you mapped out the exact main components that I had in my mind on this. We'll meet with an attorney to go through the Will and Trust with the family members to just make certain we're doing as was intended. Will provide them with as much detail about the Assets/beneficiaries so they are informed for that meeting and see what they tell us to do next. Hopefully without incurring a lot of time/fees. Seems like the flat fee person is way too expensive for what could be needed, the Assets Under management style also seems just robbery in our scenario as I don't understand how the value of Assets the estate has relates to what I need from the attorney at all, so an hourly rate that is reasonable for the city/area and practice of law probably makes the most sense. However - I do see how there could be many issues in this scenario depending upon the estate/assets that could justify some of the expense possibilities out there for this!
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