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What Section of the Trust Shows the Distribution of Trust Assets to Beneficiaries?

What Section of the Trust Shows the Distribution of Trust Assets to Beneficiaries?Trustees are generally authorized by the terms of the trust or by statute to distribute trust assets, in kind, in cash, or both.

When the trust document does not specify a mode of distribution, then it's time to make a reasonable interpretation considered in the light of all the circumstances. This, of course, can be particularly challenging when there are several beneficiaries.

Trust document review can be a little like reading medical records. Unless you are familiar with the terms used in the documents or trained in the field, particular provisions can be obtuse, obscure and confusing.

On the other hand, some trust documents can be very clear. They may have an Article or Section with a heading such as "Distribution of Income and Principal" set apart from all other headings. That helps - we can go right to that Article or Section.

Trust documents with an Article named "Distribution" are also easy to access. It can get a little more complicated when separate sections address "Distributions of Principal and Income" during the life of the settlor or after the settlor's death. It's also important to look for the section that addresses "Distribution of Remainder (or Residue) on Termination of Trust."

Sometimes a trust has a table of contents. This is also useful. A trust with a table of contents might provide a little greater specificity in titling than a more generic title like "Distribution."

The table might address specific distributions of real and personal (tangible) property. It is also likely to cover the residuary or remainder distribution. Whether distributions of trust assets, in kind, in cash, is also likely to be addressed.

We review a lot of trust documents - usually as a result of some controversy over distribution. We hope that his little explanation helps beneficiaries to identify the section in the trust that describes how assets are to be distributed - or maybe not distributed - to them.

At Hackard Law we represent beneficiaries who have been excluded from distribution of trust assets or unfairly treated by fiduciaries. We take substantial cases where we think that we can make a significant difference and there is a wrongdoer who can be made financially accountable for their wrongdoing or breach of duty.

We focus our geographic reach to California's major urban areas, including Los Angeles, Orange, Santa Clara, San Mateo, Alameda, Contra Costa and Sacramento Counties.

If you are a beneficiary and you want to talk about your rights, call us at Hackard Law: (916) 313-3030. We'll be happy to hear from you.

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