Settling an Estate PC1409-Digital

Settling an Estate PC1409-Digital

ESTATE PLANNING

TRUST ADMINISTRATION

Settling an Estate

Settling an estate can be a time-consuming and technical process. Navigating the legal, tax, and property considerations involved can prove a particularly daunting challenge. That’s why our clients have chosen Commerce Trust Company as their trustee and estate administrator. We’re here to provide guidance and continuity to family members and loved ones during this difficult time. OUR RESPONSIBILITIES In our role as trustee and personal representative/executor of the estate, Commerce Trust will undertake certain duties on behalf of the beneficiaries. Depending on the capacity in which we are serving, we will: 1. Collect and create an inventory of all trust and estate assets. This may include bank accounts, stocks, bonds, certificates of deposit, real estate, and personal property. 2. Change the mailing address of the deceased so that Commerce Trust can collect all mail.

Wealth | Investments | Planning Commerce Trust Company

ESTATE PLANNING

TRUST ADMINISTRATION

3. Coordinate with a local attorney for the timely and accurate completion of probate court requirements and proceedings (if needed). 4. Contact nursing homes, utility, insurance, and other service providers to collect refunds and add them to the total estate. 5. Complete forms and provide the documentation needed to receive death benefits from life insurance policies, annuities, and other types of benefits and contracts. 6. Secure and protect all estate assets for distribution to beneficiaries according to the trust agreement. This may include changing locks on trust real estate and cars, or working with a local attorney to secure personal property like artwork, jewelry, and coins. 7. Arrange appraisals and inspections of any real estate included in the trust. 8. Obtain appraisals and date of death valuations of any other trust and estate assets for cost basis calculations, tax returns, and other estate processes. 9. Sell or distribute all property (e.g., real estate,

ESTATE PLANNING

TRUST ADMINISTRATION

automobiles, artwork, jewelry, etc.) according to the estate planning document. 10. Publish local notice to creditors and/or notice of trust to shorten the amount of time creditors have to assert claims against the estate. 11. Review and pay all outstanding bills and debts of the estate. This includes resolving any creditor claims against the estate. 12. File state and federal tax returns with the appropriate agencies including the final individual and trust income tax returns, and if necessary, the Federal Estate Tax Return (Form 706.) 13. Distribute income and assets to the beneficiaries according to the trust or will. 14. Fund any continuing trusts. There are several important milestones we must reach on our way to closing the trust and issuing final distributions to beneficiaries. ESTATE ADMINISTRATION TIMELINE Here are a few important time periods to remember: Notice to Creditors: We use this to notify any creditors that

ESTATE PLANNING

TRUST ADMINISTRATION

may have a claim against the estate or trust. In most cases, the time that claimants have to come forward is between three and 12 months depending on local laws. Using this process, we can protect beneficiaries from any creditors of the estate after final distributions. Income Tax Return: We file both an individual and trust tax return during this process. The individual return is submitted for the year of death; a trust tax return is for the period between the grantor’s death and final distributions. Federal/State Estate Tax Return: If a person had a federally taxable estate at the time of their death, we must also file a Federal Estate Tax Return (Form 706). The federal return must be filed within nine months of date of death. Other state inheritance tax returns may also be required. Closing of the Estate: After we receive closing letters from the IRS and applicable state tax agencies acknowledging that they have received and reviewed all tax returns, we can close the estate or trust. This may take a year or more from the date the return is filed.

ESTATE PLANNING

TRUST ADMINISTRATION

DISTRIBUTION OF TRUST/ESTATE ASSETS We make every effort to distribute your share of the estate/ trust as soon as possible. You can expect distributions as follows: Specific Cash Bequests These are typically issued within the first 3 months after the trust transfers to Commerce Trust. Final Distributions The following are approximate timelines once we assume responsibilities as trustee. Unexpected legal or tax issues may delay this process. Non-taxable estate: 9-12 months Taxable estate: 18-24 months 1. Filing of tax returns: 9 months from the date of death (complex returns may require an extension). 2. IRS/State review: Up to a year or more for the appropriate agency to complete its review. 3. Final accounting: After we receive the IRS letters, we will provide beneficiaries a statement of accounting for their approval.

Gather Documentation

ESTATE PLANNING Step 1 Contact CommerceTrust

Step

$

Await Distributio

TRUST ADMINISTRATION

Final distributions 24 months

Steps to close estate detail

YEAR ONE

YEAR TWO

CREDITORS FILE CLAIMS 3-12 MONTHS

ESTATE TAX RETURN FILED

9 MONTHS

INCOME TAX RETURN FILED WITHIN 1 YEAR OF DEATH

STEP 1 CONTACT COMMERCE TRUST

STEP 2 GATHER DOCUMENTATION

STEP 3 AWAIT DISTRIBUTION

ESTATE CLOSED

21 MONTHS

FINAL DISTRIBUTIONS

24 MONTHS

INCOME & ESTATE TAXES UP TO 12 MONTHS CREDITOR DISTRIBUTIONS 3-12 MONTHS

BENEFICIARY DISTRIBUTIONS UP TO 24 MONTHS

We recommend consulting your tax professional on how these distributions may affect your personal tax situation. To assist you with tax preparation, Commerce Trust will send you details of any assets you received by April 15 of the following year. COMMERCE TRUST FEES When our responsibilities are limited to final trust administration and distribution of trust assets to beneficiaries, we charge a fee in accordance to our Estate Settlement Services Fee Schedule; in addition to our customary fee. Other fees, including real estate and tax

ESTATE PLANNING

TRUST ADMINISTRATION

preparation fees, may also apply. Contact a Commerce Trust advisor to discuss your needs. ENCLOSED DOCUMENTS/FORMS For your information only (no further action necessary):  Copy of Trust – if applicable  Fee Schedule Please complete and return:   Certification of Beneficiary/W-9: This form is required by law. It confirms and certifies you are the beneficiary identified in the will or trust and your correct social security number for our records. Please complete and sign the form where indicated and return it in the envelope provided.   Managing Agency/Trust Agreement: This is our agreement to hold the investable assets at Commerce Trust. You may authorize other individuals to have access to information about the investments at Commerce Trust, but you are not required to do so. Please sign in each of the tagged areas and return it in the enclosed envelope.

ESTATE PLANNING

TRUST ADMINISTRATION

Settling an estate can be a daunting challenge. Working with a Commerce Trust advisor assures you the estate will be administered in a timely and thorough manner. You’ll find comfort in a difficult time knowing things are being carried out as intended. 1-855-295-7821 | commercetrustcompany.com

Wealth | Investments | Planning Commerce Trust Company

Commerce Trust Company is a division of Commerce Bank.

NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE