Developing your estate plan often involves appointing a trustee. Understanding the trustee’s role after your death is crucial to selecting the right person to administer your estate. When you are ready to establish your plan, an experienced estate planning attorney can help you understand the trustee’s duties as they advise on whom you should consider appointing.
Who Can Serve As a Trustee?
Many people select a trusted family member or close friend to serve as the trustee of their estate. However, depending on the complexity of your estate and the number of beneficiaries, you may consider appointing a corporate trustee, such as a banker or financial planner. As your attorney prepares your trust, they can advise you who may be best suited to serve as trustee.
What Does A Trustee Do?
Your trustee plays a critical role in administering your estate when you die. They must follow the trust documents you and your attorney prepare to ensure they distribute your property to your designated beneficiaries per your wishes.
Upon your passing, your trustee will identify and inventory the trust property. They will also assess your debts and liabilities and pay any bills and taxes. Then, they will distribute the trust’s remaining assets to your beneficiaries according to the trust documents.
What Other Duties and Responsibilities Does A Trustee Have?
The role of trustee comes with additional specific duties. Namely, they owe you (as grantor) and the trust you created a duty of loyalty, meaning they must act solely in the trust’s and its beneficiaries’ best interest. In other words, they are prohibited from using trust assets for personal gain. The trustee must work with your attorney, accountants, and financial planners to ensure they properly fulfill your wishes.
Trustees also have a duty of care. What does this mean? Like the duty of loyalty, they must act in the trust’s best interests as they oversee the assets and investments. Trustees must prudently manage the trust assets and develop an investment strategy to promote their growth. Trustees are also charged with serving the trust’s beneficiaries by dealing with them impartially and helping them avoid conflicts.
What Happens If A Trustee Fails To Satisfy Their Duties and Responsibilities?
As grantor, you designate your trustee with the hope that they will dutifully carry out your goals and desires for your beneficiaries as they administer the trust. Unfortunately, this does not always happen. The trustee may engage in self-dealing for their personal benefit or overcompensate themselves for their work in excess of the trust charging clause, the basis by which they can be paid for their services. Of course, this is a problem because your intended beneficiaries then do not receive the full extent of the assets you intended to give them.
Trust beneficiaries should seek advice concerning their legal options if they discover the trustee is not fulfilling their duties. An attorney may advise them that legal action is necessary to pursue financial losses related to the trustee’s mishandling of your estate and to ensure that the trustee follows the trust documents. Every case is different, but you can expect an experienced probate litigation attorney to be well-equipped to handle these circumstances.
Call Silverman, Tokarsky & Forman, L.L.C., Today
Silverman, Tokarsky & Forman, L.L.C., is dedicated to helping individuals create the estate plan they desire. We understand that starting the planning process may feel overwhelming. We’re here to answer all your questions and prepare a plan to provide financial security for your loved ones. Contact us today for a confidential consultation with an experienced estate planning attorney.
