We were told (by the trustee) that the irrevocable trust held by his bank in South Carolina doesn't become a part of the deceased's estate and the trustee has the right to distribute any/all funds as he sees fit, without notice to any other beneficiaries, whenever he wants. Is that true?
Personal Injury Lawyer
One of the primary purposes of adopting a trust is to keep the disposition of one's assets away from the probate court process. Unless there is more to the factual scenario, which is entirely possible, a trustee in a properly executed trust distributes assets in accordance with the trust, and not any probate laws pertaining to an "estate".
This answer is provided for informational purposes only. Actual legal advice can only be provided in an office consultation by an attorney licensed in your jurisdiction, with experience in the area of law in which your concern lies.
Estate Planning Attorney
The trustee is correct that trust assets do not normally become part of a deceased person's estate. The assets must be distributed according to the terms of the trust. The trustee might have some discretionary powers as to when he must distribute the assets or how much he is required to distribute to each beneficiary, but he needs to remember that no one died and named him king - many non-professional trustees are under the misguided notion that they're little Napoleans and can do whatever they please, whenever they please, to whomever they please without any ramifications.
Check to see if you have the right to receive a copy of the trust (you have that right in most states). If so, get a copy and read it. If you can't understand it, hire an estate planning lawyer to interpret it for you (it shouldn't cost an arm & a leg to have that done). Make sure you understand what the trustee can -and cannot - do. Having the right information will be worth the money you spend.
The information you obtain at this site is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation.
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Not typically. The beneficiaries of this trust should have a copy of it. Have a local attorney review the provisions regarding disposition of the assets. It is quite possible that an irrevocable trust took the assets out of the decedent's estate, that is typically the purpose of an irrevocable trust. However, the trustee has to follow the trust provisions with regard to disposition of the assets. The trust could give the trustee complete discretion. Again, you need to look to the document.
Any individual seeking legal advice for their own situation should retain their own legal counsel as this response provides information that is general in nature and not specific to any person's unique situation. Circular 230 Disclaimer - Advice given in this response cannot be used to eliminate penalties with the IRS or any other governmental agency.