What Are the Responsibilities of a Trustee to a Beneficiary?
Quick Answer
The responsibilities of a trustee to a beneficiary include complying with the instructions in the trust document; keeping the trust assets separate from the trustee's personal assets and maintaining separate records; and investing the trust assets in fiscally conservative ways, according to WealthCounsel. Unless the trust language permits it, the law forbids a trustee from using trust assets for the trustee's personal benefit. If there is more than one beneficiary, a trustee must treat all beneficiaries equally, without showing favoritism.
Continue ReadingFull Answer
A trustee's obligations include accurate record keeping, timely tax return filing and periodic reporting to the beneficiaries in accordance with the trust instructions, explains WealthCounsel. A trustee can retain professional assistance, such as an attorney, certified public accountant and investment adviser. The ultimate responsibility for the trust assets remains with the trustee. The trust document typically gives guidance for compensating a trustee.
Trust documents often provide for co-trustees, such as married couples. Naming co-trustees enables a smooth transition without court intervention in the event that one trustee passes away, or is no longer able to serve, notes WealthCounsel. The trust grantor can also name successor trustees in the trust document. A successor trustee assumes responsibility for the trust if the original trustee is unable or unwilling to continue serving.
Learn more about Financial PlanningRelated Questions
-
Q:
How Do You Set up a Trust?
A: To set up a trust, hire an attorney, select a trustee and beneficiary, and decide on the type of trust that is best for your situation. Trusts are not only... Full Answer >Filed Under: -
Q:
How Does a Trust Work?
A: Trusts are a type of estate planning tool in which the grantor creates a fund by transferring assets and designates a trustee to manage the assets for a be... Full Answer >Filed Under: -
Q:
How Do You Write a Living Trust?
A: To write a living trust, organize information about assets, beneficiaries, a successor trustee and desired guardianship of children, notes LegalZoom. Organ... Full Answer >Filed Under: -
Q:
What Percentage of an Estate or Trust Can the Trustee Legally Charge?
A: Generally, executor or trustee compensation for administering an estate or trust is set at around 1 percent of the total value of the assets, according to ... Full Answer >Filed Under:
You May Also Like
-
Q:
What Services Can Kentucky Government Employees Access Through the My Retirement Website?
-
Q:
What Is the Best Option for Emergency 401(k) Withdrawal?
-
Q:
Where Can You Find Information About SEP IRA Contribution Deadlines?
-
Q:
What Is Midland National Life Annuity?
-
Q:
How Long Can an IRA Account Be Held After the Death of Its Owner?
-
Q:
What Are Basic 401(k) Plan Rules?
