Commonly Asked Questions - Part 2

Question: Who pays the fees on an Irrevocable Life Insurance Trust?

Question Detail: The trustee resigned on Irrevocable Life Insurance Trust. The trustee resigned for lack of payment. The trust documents do state how to appoint a successor trustee, and it's fairly simple. I had no idea that I even had a trust fund until I was given notice of the resignation. Who was paying the fees ($3000) a year previously? Wasn't it paid out of the trust? Also, what are the consequences of not having a trustee? Can we still collect money from the trust without a trustee? 

Answer: Your answer depends upon state law and how the trust was written, but generally the trust pays the trustee fees.  There is an expression:  “A trust never fails for want of a trustee.”  The trust probably contains language stating how a new trustee is chosen.  If not the controlling probate/surrogate court probably has the authority to appoint a trustee upon petition to do so.  I suggest you get a copy of the trust to ascertain your rights to trust funds.

Question: Can I get control over my father's estate if I live in a different estate than he does?

Answer: I assume you mean as the personal representative or Executor.  If so, it depends upon the state’s rules.  Some states yes; some no.   If your father is alive, your father may sign a durable power of attorney appointing you as his agent to handle financial matters.  He also could put you on title of his accounts or draft a trust, transfer his assets to the trust while also appointing you as trustee. 

Question: Can one sibling have medical power of attorney of our parents and another sibling have financial power of attorney?

Answer: Absolutely.  It’s done quite often.

Question Detail: Someone told me that only one person can have total power of attorney and that it cannot be split.

Answer: No so.  There may be multiple agents appointed, each with separate authority to act or all to act jointly.