A relative of mine passed away last fall, and in his will, left some money to my kids in an education trust. He also named my wife & me as trustees. Does anyone know of any resource/guide that will help us understand our duties, and any obligations we may not be aware of? The attorney handling the estate really isn't much help, which I understand, because he is working for the estate, not us. I've tried searching online, but most everything I find tells about how to leave money for someone in an education trust. Our tax advisor helped us file a form to get an EIN for the trust, but freely admitted that trusts are not his area of expertise, and indicated that in his opinion, the estate attorney should be giving us more guidance. I'm really trying to avoid hiring an attorney myself, as money is tight right now.
education trust
- Thread starter zrxkawboy
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How long until your kids are college age? If it's awhile then no hurry to find out.
Reason I said that is because in this case it sounds as if a consultation with an attorney is a good idea. Trust details can be confusing, depending on how they are set up. Sounds like the attorney handling the estate is doing a poor job, as he should tell you where the trust is held and any administrators, as well as an attorney that can help you with the details (if he can't or won't).
Reason I said that is because in this case it sounds as if a consultation with an attorney is a good idea. Trust details can be confusing, depending on how they are set up. Sounds like the attorney handling the estate is doing a poor job, as he should tell you where the trust is held and any administrators, as well as an attorney that can help you with the details (if he can't or won't).
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I was prepared to offer advice on a basic 529 account, but this is beyond my scope; it's definitely something to bring to an attorney who specializes in trusts.
what kind of trust is it? You have to tell us at least that if you're going to crowdsource this.
but I'd agree with kuato, do you have educational expenses right now, and how much is in the trust; then you can do a cost/benefit if hiring a lawyer for an hour is worth it.
If you're going the internet lawyer route, i suppose you can cross post your question on more forums where lawyers would actually troll-but you get what you pay for.
but I'd agree with kuato, do you have educational expenses right now, and how much is in the trust; then you can do a cost/benefit if hiring a lawyer for an hour is worth it.
If you're going the internet lawyer route, i suppose you can cross post your question on more forums where lawyers would actually troll-but you get what you pay for.
Laws vary from state to state.
If you were in Florida I could ask a relative your question and get you free advice.
If you were in Florida I could ask a relative your question and get you free advice.
Thanks for the replies. To answer some questions: Our older child is just starting 6th grade, so it won't be needed for awhile. The estate lawyer simply mailed a check to us for the full amount (!), and told us to send the EIN to him when we receive it. From what I can tell, we need to open a bank account in the Trust's name. As far as what type it is, it's simply known as an Education Trust. I was just hoping maybe someone else was in this situation and could point me in the right direction. Thanks!
Originally Posted By: zrxkawboy
Thanks for the replies. To answer some questions: Our older child is just starting 6th grade, so it won't be needed for awhile. The estate lawyer simply mailed a check to us for the full amount (!), and told us to send the EIN to him when we receive it. From what I can tell, we need to open a bank account in the Trust's name. As far as what type it is, it's simply known as an Education Trust. I was just hoping maybe someone else was in this situation and could point me in the right direction. Thanks!
Sounds like setting up 529s for the kids would be the way to go, since the (lazy) lawyer simply sent you a check.
Thanks for the replies. To answer some questions: Our older child is just starting 6th grade, so it won't be needed for awhile. The estate lawyer simply mailed a check to us for the full amount (!), and told us to send the EIN to him when we receive it. From what I can tell, we need to open a bank account in the Trust's name. As far as what type it is, it's simply known as an Education Trust. I was just hoping maybe someone else was in this situation and could point me in the right direction. Thanks!
Sounds like setting up 529s for the kids would be the way to go, since the (lazy) lawyer simply sent you a check.
Originally Posted By: zrxkawboy
Thanks for the replies. To answer some questions: Our older child is just starting 6th grade, so it won't be needed for awhile. The estate lawyer simply mailed a check to us for the full amount (!), and told us to send the EIN to him when we receive it. From what I can tell, we need to open a bank account in the Trust's name. As far as what type it is, it's simply known as an Education Trust. I was just hoping maybe someone else was in this situation and could point me in the right direction. Thanks!
Easy enough. Assuming you're in South Dakota: Your state doesn't offer a tax benefit for 529 college plans, so just make your way over to Vanguard's website and open one there (lower expenses than the state plan). Then, pick where to invest the money, and you'll be set.
Thanks for the replies. To answer some questions: Our older child is just starting 6th grade, so it won't be needed for awhile. The estate lawyer simply mailed a check to us for the full amount (!), and told us to send the EIN to him when we receive it. From what I can tell, we need to open a bank account in the Trust's name. As far as what type it is, it's simply known as an Education Trust. I was just hoping maybe someone else was in this situation and could point me in the right direction. Thanks!
Easy enough. Assuming you're in South Dakota: Your state doesn't offer a tax benefit for 529 college plans, so just make your way over to Vanguard's website and open one there (lower expenses than the state plan). Then, pick where to invest the money, and you'll be set.
I would agree with others who said that you might be best served by a lawyer or financial planner ( especially if it's a significant amount of money ). Without knowing the laws of your state as to what constitutes an educational trust and what constitutes a custodial account, it would probably behoove you to get help.
If a sizable portion of this money would be used in financial aid calculations then that's something else to think about...although you're six or seven years away you might need to plan for that situation. You definitely want to be clear on your options as it relates to your circumstance before setting something up.
If a sizable portion of this money would be used in financial aid calculations then that's something else to think about...although you're six or seven years away you might need to plan for that situation. You definitely want to be clear on your options as it relates to your circumstance before setting something up.
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