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Julie Garber

Personal Representative vs. Trustee - What's the Difference?

By December 24, 2009

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Yesterday I posted the estate planning term of the week - Trustee. If your estate plan includes a Revocable Living Trust or some other type of trust, then you will need to understand the difference between a Personal Representative and a Trustee. While both are types of "Fiduciaries," they each play a very different role in an estate plan.

A Personal Representative is appointed by a probate judge to oversee the administration of a probate estate and can be a person, an institution, such as a bank or trust company, or a combination of both. If the decedent had a Last Will and Testament, then in most cases the probate judge will appoint the Personal Representative named in the Last Will. If the decedent did not have a Last Will, then state law will dictate who the probate judge should appoint to serve as the Personal Representative.

On the other hand, a Trustee is named by the person who creates a trust, called the Trustmaker - which happens to be last week's estate planning term - to oversee the day to day management of property owned by the trust for the benefit of the trust beneficiaries. As with a Personal Representative, a Trustee can be a person, an institution, or combination of both. In the typical situation, the Trustmaker, Trustee and Beneficiary of a Revocable Living Trust are one in the same person, but if the Trustmaker becomes disabled or dies, then a successor Trustee will step in to manage the trust property.

Ideally if you have a fully funded Revocable Living Trust, then your estate will avoid probate and your heirs will not need a Personal Representative at all.

April 18, 2012 at 9:36 pm
(1) georgi says:

if there is an in terrorem clause, that says any one who challenges or contests any provision of my will, that heir shall not receive any portion,and that heir contests the personal rep, and lost, do you know if that would happen?

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