What You Should Know Before Agreeing to Serve as Trustee

Being asked by a loved one to serve as a trustee for their trust upon their death can be a deeply meaningful honor. At the same time, it’s a significant responsibility—not a decision to be taken lightly. Serving as a trustee involves a wide range of duties, and these responsibilities come with both legal and ethical obligations. If you fail to properly carry out your role, you could face serious consequences.

The responsibilities of a trustee can vary depending on the size and complexity of the estate, the type of assets in the trust, the specific terms of the trust, and the number of beneficiaries involved. That’s why it’s important to understand exactly what is expected of you before agreeing to take on this important role.

And remember, you’re not obligated to accept the position. It’s always okay to decline if you feel the role isn’t right for you. However, if you do decide to accept, it’s essential that you fully understand what’s involved.

This article provides an overview of the typical duties of a trustee. If you’re considering serving as a trustee, or if you’ve already been asked, we invite you to schedule a Life and Legacy Planning Session with us. We can help you assess whether you’re up for the task or whether declining might be the best option.

A Trustee’s Primary Responsibilities

While every trust is different, all trustees share certain key responsibilities. At its core, your job as a trustee will involve managing and distributing the trust’s assets in accordance with the trust’s terms, always acting in the best interest of the beneficiaries.

As a trustee, you serve as a?fiduciary, which means you have a legal obligation to act in the best interests of the trust and its beneficiaries. You must always place their interests ahead of your own and exercise the highest standard of care in your actions. Failing to meet these obligations could result in legal liability.

Here are some of the core duties you’ll need to fulfill as a trustee:

• Identify and Protect Trust Assets: You’ll need to locate and protect all assets listed in the trust.
• Follow the Trust’s Terms: You must manage and distribute the trust assets as outlined in the trust document.
• Manage Taxes: You will need to hire an accountant or tax professional to file income and estate taxes for the trust.
• Communicate with Beneficiaries: Regular, transparent communication with the beneficiaries is key to ensuring everyone understands what’s happening with the trust.
• Maintain Detailed Records: Keep organized and detailed records of all trust transactions and activities.
• Close the Trust: Once all duties have been completed and the terms of the trust are met, you’ll close the trust as specified.

You Don’t Have to Do It Alone

It’s important to note that being a trustee does?not?require you to be a legal or financial expert. In fact, many trustees, especially family members or close friends, are not experts in law, taxes, or finance. However, you are encouraged to seek professional advice when needed—and you won’t be on your own.

The trust can pay for you to hire legal, financial, and tax professionals to help you navigate your responsibilities. This means you don’t have to handle everything yourself. In fact, working with experienced advisors can help you fulfill your duties more effectively and with greater confidence.

Additionally, many trustees choose to waive compensation for their role, especially if they are family members. However, you can be compensated for your time and effort, depending on your agreement with the trust’s creator and the nature of the assets.

How We Can Help

Given the significant responsibilities involved in serving as a trustee, it’s a good idea to seek guidance before making your decision. We can help you evaluate whether the role of trustee is a good fit for you, based on the specific terms of the trust, the assets, and the beneficiaries involved.

Our Life and Legacy Planning Sessions are designed to provide clarity and insight into your duties as a trustee. We’ll walk you through the trust’s details, help you understand what’s expected, and offer guidance on how to handle the responsibilities in the best possible way.

If you’ve been asked to serve as a trustee – or are considering taking on this role – reach out to us today to schedule your Life and Legacy Planning Session. We’re here to ensure you have the information and support you need to make an informed decision.

At Cheever Law, APC, we don’t just draft documents; we ensure you make informed and empowered decisions about life and death for yourself and the people you love, starting with a valuable and educational Life & Legacy Planning Session. This will allow you to get more financially organized and make the best choices for the people you love. If you have already completed your estate plan, we will review that plan at your Life & Legacy Planning Session to ensure that it will work the way you intend and address any holes or gaps that may be present if circumstances have changed since you executed your plan.

To learn more about our one-of-a-kind systems and services,?contact us ?or?schedule a no-obligation 15-minute introductory phone call ?today.