When a minor or incapacitated adult requires someone to make financial decisions for them, the court appoints a conservatorship. A conservator handles the individual’s investments, assets and bank accounts and handle collecting any debts, paying bills and managing cash flow.
In What Situations is a Conservator Appointed?
For minors, the court appoints a conservator when their parents are incarcerated, incapacitated, dead or otherwise unable to perform their parental duties and have left their children a certain amount of money, including an estate in trust.
A court might appoint a conservator for incapacitated adults as well. The person must have a problem making sound financial decisions. Examples might include elderly individuals with dementia or Alzheimer’s or individuals with mental health disorders, development disorders or a physical ailment that impacts their financial judgment. Generally, a doctor must determine that an individual is incapacitated for the court to order a conservatorship.
What Is the Difference Between a Conservator and a Guardian?
This is similar to a guardianship in that another individual makes important decisions for the minor or incapacitated adult. However, a conservator specifically handles the finances. Generally, a conservator is appointed when the individual’s estate is more than $24,000. A guardian will handle day-to-day finances and monies and small funds. The same person might act as guardian and conservator.
Conservatorship In Business
Another type of conservatorship is a government control of private corporations or organizations, which means that the government has a temporary control over the business. Businesses can also be placed under conservatorship by a debt collector as a more lenient version of a receivership. In where a receivership terminates the rights of managers and shareholders, a conservator assumes the rights temporarily in order to handle a major problem.
If you become a conservator of someone’s estate or trust, you might need an IRS-EIN-Tax-ID. At IRS EIN Tax ID Filing Service, we provide assistance in applying for a federal tax ID number. We can also help with an EIN lookup if you are unsure if you already have one. Contact us to find out more.