What to Expect as a Beneficiary of an Estate or Trust

One aspect of estate planning is identifying beneficiaries for your assets—those are the people you want to leave assets or benefits for when you pass away. People often do this via methods such as wills and trusts. However, many people don’t realize they have some legal rights if they are named a beneficiary of an estate or trust.

What Are Beneficiaries of an Estate or Trust?

Beneficiaries are people named in a will, trust, or other estate document, designating them as someone to receive assets from the estate. In the case of a trust, the beneficiary is someone who benefits from the assets in the trust, sometimes through disbursements made by a trustee.

Beneficiaries are not the same thing as heirs. Heirs are individuals who can be beneficiaries but who would also receive assets from the estate even if no will or other document is present because they meet the requirements for state intestacy laws. Those are the laws that govern how assets are disbursed among relatives should someone pass away without a will.

Rights of Beneficiaries

Beneficiaries have legal rights within the context of an estate. That includes the right to be informed about their beneficiary states and to question or challenge certain things related to the estate.

The Right to Be Informed

In general, beneficiaries have the right to information about the will or trust and their relationship to it. With wills and other probate matters, this is straightforward, as notice of probate is required by law. When an estate is probated, the law in New Jersey requires that the next of kin and any named beneficiaries (or any known heirs) are notified:

• When and where the will was probated
• Who the personal representative or executor is, along with their address
• That a copy of the will is available upon request

The executor of the estate typically handles this duty. They must mail a notice with this information to all named beneficiaries and the next of kin. In cases where the executor does not have a mailing address for someone who needs to receive this notice, the notice must be published in an appropriately circulating newspaper.

Beneficiaries to estates and trusts also have a right to ongoing information regarding the estate. The exact information relevant to a beneficiary may be governed by the provisions of a trust and the law, and trusts do not go through probate, so notification requirements are different.

The Right to an Accounting

Heirs and beneficiaries of an estate put through probate have a right to receive an accounting of how the executor or personal representative handled the estate assets. This includes information about:

• Whether assets were sold and what amount was received for them
• What debts of the estate were paid and how much those payments were
• How the assets are distributed among beneficiaries

Trust reporting is different, but beneficiaries typically have some right to regular reporting. The trustee or administrator of the trust must report information about the assets of the trust, its income and expenses, and how the assets are disbursed.

The Right to Challenge the Will, Trust, Executor, or Administrator

Beneficiaries to an estate have the right to challenge certain things during probate. First, if you don’t think that the will is valid, you can challenge it. You might do that if you think your loved one didn’t create the will and sign it themself, if you don’t believe they were mentally capable of understanding the will they signed, or if you think they were coerced or influenced unduly. You can also challenge some actions of the executor if you don’t think they are fulfilling their probate duties correctly under the law.

As a beneficiary of a trust, you also have some rights to challenge the trust or trustee. For example, if you believe the person who created the trust wasn’t mentally capable of understanding what they were doing or was being coerced or unduly influenced, you can challenge the trust.

The Right to Proper Management of an Estate or Trust

The executor of an estate or the administrator of a trust both step into what is known as a fiduciary role. That means they have a legal responsibility to act in the best interests of the beneficiaries and manage assets to the best of their ability with that requirement in mind. If you believe that an executor, trustee, or administrator is not meeting their fiduciary duty, you can challenge their actions. You might even go so far as to ask the court to replace the person with a new executor or administrator.

How Can You Protect Your Rights as a Beneficiary?

Protecting your rights as a beneficiary to an estate or trust requires that you know what those rights are and that you pay attention to estate or trust management. It’s important to educate yourself about the estate or trust so you know what you are supposed to receive as a beneficiary and whether someone in a fiduciary role might fail to fulfill those requirements.

Trusts and probate matters can be complex, though. Working with an experienced legal team to understand your rights and whether they’ve been infringed—and then to fight for them if they have been—can be helpful. Contact Bratton Estate & Elder Care Attorneys today by calling 856-770-2744 to find out how we can help.