What is the difference between an estate and a trust?

An estate and a trust are two types of legal entities that manage the distribution of property and assets of an individual upon their death. While both are intended to provide for the orderly and efficient transfer of assets, they are very different. An estate is established when an individual dies. It is a legal entity that is responsible for collecting and managing the assets of that individual, as well as paying any outstanding debts and taxes. The estate is supervised by the court and the court will ultimately determine how the assets of the estate will be distributed. A trust, on the other hand, is created during a person’s lifetime. It is also a legal entity that holds and manages the assets of the trustor (the person who creates the trust). Unlike an estate, the trust is not supervised by the court and the trustor can designate who will receive the assets when they pass away, and how it will be done. In North Carolina, both estates and trusts must be administered according to the law and the wishes of the individual who has created them. It is important to consult with an attorney in order to be certain that all of the legal requirements are met.

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