1. What Happens to the Trust the Moment the Person Dies
During life, a revocable trust is fully controlled by the person who created it (the “settlor”). They can change it or cancel it at any time.
At death, everything changes:
- The revocable trust becomes irrevocable upon death automatically.
- The successor trustee now has full legal authority over the trust assets.
- That trustee must follow Georgia law and the instructions written in the trust.
- The trustee is now responsible to the beneficiaries, not the person who died.
A revocable trust does not protect assets from the person’s debts after they die. If the probate estate does not have enough money to pay bills, creditors can reach the trust assets.
2. How the Successor Trustee Takes Over
The successor trustee must accept the role by signing an Acceptance of Trustee document, getting a new EIN (tax ID) for the trust from the IRS, and beginning to act as trustee by managing accounts and securing property.
Banks, title companies, and financial institutions will ask for proof that you are the trustee. Georgia allows a simple document called a Certification of Trust, which gives the trust name and date, the name of the person who died, and the name and address of the successor trustee.
3. Secure and Identify All Assets
The trustee must gather every asset that belongs to the trust: real estate, bank accounts, investment accounts, vehicles, and business interests.
Real Estate
If the real estate was titled in the trust, file an Affidavit of Successor Trustee in the county where the property is located. The house stays owned by the trust, but the successor trustee controls it. The trustee can keep it in the trust, sell it, or transfer it to a beneficiary — all according to the trust document.
If the property was not titled in the trust, you may need probate to move it.
Bank and Investment Accounts
- If the account was properly titled in the trust — you take over as trustee.
- If the account has a POD (pay-on-death) beneficiary — that money bypasses the trust entirely.
- If the account was listed in the trust on a schedule but not retitled — the bank’s contract wins, not the schedule.
4. Handle Creditors and Debts Correctly
Even though a trust avoids probate, trust assets can still be used to pay debts if the probate estate runs out of money. Because of this, every trustee should be careful before distributing anything to beneficiaries.
If there are any debts, consider opening a simple probate for the sole purpose of running the creditor clock. It makes the trust safer and reduces the chance that a creditor will come back later and attack trust distributions.
5. Notify Beneficiaries Within 60 Days
Georgia law requires the trustee to notify all qualified beneficiaries within 60 days of death. Each beneficiary must receive the trustee’s name and address, a statement that the trust exists, and a notice that they may request a copy of the trust.
Ongoing duties include annual accountings showing income, expenses, assets, and changes, and clear communication when beneficiaries request information.
6. Taxes the Trustee Must Handle
Once the person dies, the trust becomes a separate taxpayer. The trustee must get a new EIN, file Form 1041 (federal trust tax return), file Georgia Form 501 (state fiduciary return), and issue K-1s to beneficiaries if income is distributed.
Most trusts must file taxes if they earn more than $600 in income.
7. Distributing Assets and Closing the Trust
Once all assets are gathered, all creditors are handled, taxes are completed, and beneficiaries have been notified — the trustee can begin distributing the assets.
Before distributing, have each beneficiary sign a Receipt, Release, and Indemnification Agreement. This confirms they received their share, releases the trustee from future claims, and requires them to return money if a surprise debt shows up later.
The trust ends when all instructions in the trust have been carried out, all required reports and taxes are complete, and all assets have been properly distributed.
Trustee Checklist
Week 1 to 2: Find the trust document. Sign Acceptance of Trustee. Get the death certificate. Prepare the Certification of Trust. Secure the home, accounts, and valuables.
First Month: Gather all financial accounts. Verify property titles. Record Affidavit of Successor Trustee for real estate. Identify debts.
First 60 Days: Send notice to all qualified beneficiaries. Open probate if debts exist. Begin trust accounting system.
90 to 180 Days: Pay valid debts. File taxes (Form 1041 and Georgia Form 501). Prepare beneficiary reports.
When Ready to Close: Prepare final accounting. Have beneficiaries sign Receipts and Releases. Distribute trust assets. Keep records for at least 7 years. Close trust bank accounts.
Common Mistakes Trustees Make
- Distributing money too early.
- Ignoring debts because “the trust avoids probate so we are safe.”
- Not checking POD or TOD accounts.
- Using the deceased person’s Social Security Number after death.
- Not sending the 60-day notice to beneficiaries.
- Failing to record the Affidavit of Successor Trustee before selling property.
- Not collecting Receipts and Releases before distributing assets.
