[WSBAPT] Specific bequest of income producing property

Tue Aug 16 10:59:51 PDT 2016

I think some of the answers come down to the precise provisions in the Trust. If the gift of the condo is a specific gift, not an apportionment of the residuary, and if the trust provides that expenses come out of the residuary, the condo and the income (net of expenses related to the condo) post death should all go to the beneficiary. If the condo is simply allocated to one beneficiary’s share as a portion of his share of the residuary, then the income is almost certainly available for expenses. This also is relevant to who will ultimately report and pay taxes on this income.

I believe waiting the four months, if there is any question of challenges to the Trust or claims in excess of the residuary. I see no reason to delay beyond that, and if there is sufficient assets to pay all liabilities, distribution could occur sooner.

Heather

Heather S. de Vrieze
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From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Kristina devore
Sent: Tuesday, August 16, 2016 9:14 AM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: [WSBAPT] Specific bequest of income producing property

Listmates,

I’m reviewing a trust where the Trustor made a specific gift of a condo that has tenants and is producing income.  The Trust provides that the successor Trustee is to administer the estate and pay all expenses and debts and then distribute the estate.  The beneficiary wants the condo distributed immediately because it is producing income and he wants to make sure that he is getting all of the income accruing since the date of Trustor’s death.  (It has been one month since Trustor’s death.)

My questions are 1) what time frame does the successor Trustee have to distribute the assets?  I’ve advised that until the successor trustee can get a good idea of the total assets and total liabilities, she shouldn’t distribute anything.  And 2) does all the income from the date of death from this specifically devised property belong to the beneficiary or does it belong to the trust estate and become available to share in the cost of administration of the estate?

Thanks in advance for any words of wisdom!

Kristina

Kristina S. DeVore | Attorney & Counselor at Law
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