Legal Question in Wills and Trusts in California

My father just passed in February. Before he passed he changed his trust several times. He changed the distribution of the trust to 30% to me and my step sister and 40% to my step mother. The last thing he did was remove me as executor (due to badgering from the stepmother and step-sister).

I just received an email from his financial person who is working with the trust attorney, stating that he never changed the beneficiary on 90% of his policies. I am the beneficiary. They now want me to ask the insurers to pay directly to the trust so his supposed wishes can be met.

Can I be compelled to do that? If I do that are there any tax implications for me?


Asked on 5/27/13, 5:36 am

4 Answers from Attorneys

Kelvin Green The Law Office of Kelvin Green

Trusts and life insurance polices are two different things... If you receive life insurance proceeds they are generally not taxed. The trust is probably funded with other assets that it is split up. From my perspective, his wishes were for you to have the life insurance proceeds and the trust then distributes the rest. It us presumptuous that the trustee can tell you what his wishes were because that's what the trust beneficiaries and life insurance beneficiaries designations are for... If you want to donate to trust for harmony's sake it is one thing but his wishes were clear or he would have changed everything else.

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Answered on 5/27/13, 7:05 am
Michele Cusack Pollak & Cusack

Don't let them pressure you... if your dad was competent to make the changes that he made to his trust, he was competent enough to realize that they didn't affect the insurance policies. You are entitled to the proceeds.

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Answered on 5/27/13, 7:31 am
Chris Johnson Christopher B. Johnson, Attorney at Law

I agree that generally the named beneficiary on the policies will receive them, though I'd have an attorney review the trust and policy designations to be sure they can't force you to give them to the trust. They can always sue you to do so, but they'd have to have good evidence to win. If you did voluntarily want to give up the proceeds to the trust, you may be able to disclaim them within 9 months of your father's death without gift tax consequences--otherwise, you're making a taxable gift to the other trust beneficiaries.

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Answered on 5/27/13, 7:47 am
Victor Waid Law Office of Victor Waid

I agree with all three previous attorneys answers. Don't let family members pressure you, and stand your ground.It is recommended you obtain the assistance of probate counsel to assist you in any responses you feel should be made to family members.The counsel will be a safe backup to prevent you from making any decisions you may come to regret. This type of counsel is known as beneficiary representation counsel to assist you in decisions that need to be made.

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Answered on 5/27/13, 12:25 pm


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