Probate and trust administration are two legal processes used to manage, settle and distribute an estate. They are similar to some degree, as both have the same goal of transferring wealth to a decedent’s beneficiaries.
They also both involve a fiduciary (an executor or personal representative in probate and a trustee in trust administration). These parties follow the instructions in the will or trust, gather and manage assets, pay debts, file tax returns and act in the best interest of the beneficiaries.
These two processes differ in various ways, including the following.
Court involvement
Probate is a public, court-supervised process. The Delaware Register of Wills has to validate a will, appoint an executor if there isn’t one already designated and ensure that assets are distributed lawfully.
The court will require formal filings, such as:
- The petition for probate to open the estate and appoint the executor
- Inventory and appraisal – A list of all probate assets owned by the decedent
- Affidavit of notice – A sworn statement confirming the executor has sent the notice of probate to all beneficiaries
- The final accounting – A detailed financial report listing assets, income received, expenses paid, changes in assets and how the remaining assets were distributed to beneficiaries
Trust administration is private. Court involvement is generally not required, as there is no mandatory filing of accounts. The trustee distributes assets to beneficiaries with no public disclosure.
Time
Trust administration is generally faster. Probate can take several months or even longer if an estate is complex or when the will is contested.
Cost
Trust administration often costs less than probate, as it avoids court supervision and filing fees. Probate generally includes probate fees as well as other costs
The right choice depends on one’s preferences. Having experienced legal guidance can help people make informed decisions when estate planning. It’s also important in helping executors and trustees carry out their fiduciary duties.