I’m a Successor Trustee – Now What?

Hi there. My name is Bridget Mackay. I’m an attorney in Petaluma, California, and I practice in the area of estate planning, probate, trust administration, and elder law.

Today I’m going to talk about, “Oh, no! I am a successor trustee. And they need me now.” What do you do? In one sense, being named a successor trustee is an honor because that person who’s named you thinks highly of your skills and your integrity. In another sense, this honor can also be a very tough job. So, as a successor trustee, you are in charge of administering the trust, meaning you are the person that is carrying out the wishes of the person who has created the trust. It also means that you must do all of this, along with any applicable provisions of state law, or federal law. What’s more, you may find yourself in this role before the death of a trustor when they are incapacitated or can no longer manage their affairs. Unfortunately, there is no one size fits all instruction manual for you. You’ll need to closely follow the written terms of the trust, use your good judgment, and often seek the advice of experts. And all along the way you have a legal duty to the beneficiary, or the beneficiaries, if there are more than one, to manage the assets in their best interest, not as if those assets were necessarily your own.

Some questions you may have if you find yourself in this role is, what distributions need to be made? How do I make distributions? What taxes will I need to pay? And how should I invest these assets I’m now managing? Each trust comes with a unique set of circumstances that can make this job quite tricky. In most cases, it’s very wise to seek the advice of a professional, starting with an experienced estate planning attorney who can review the terms of the trust that you may not understand, brief you on the legal requirements, and alert you to any potential pitfalls you might find along the way for your unique situation, and generally make your process a lot smoother. If you find yourself in this role, run out and find a qualified estate planning attorney that can help you along the journey.

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