St. Petersburg Trust Administration Attorney

Trustees have a number of legal obligations when they are administering a trust. They need to be extremely careful because they could be personally liable if they make a mistake. This is why it is crucial to be safe rather than sorry. Denyse D. Kruse advises trustees on their legal obligations.

The trustee has many obligations to be aware of when managing the trust. Above all, they must make prudent decisions with trust assets. First, they need to understand the terms of the trust and how to properly do their job. They need to administer the trust in exact accordance with the grantor’s wishes. Not every trust is created the same, and your particular trust may have its own unique issues.

Trustees Often Need Legal Help

Many trustees are new to the position and have never been an administrator before. There may be a learning curve as they get up to speed. However, being a trustee does not allow one to learn on the job. There are serious and real responsibilities, but trustees sometimes need extra assistance.

In addition, trustees may need advice about the following:

If you are a trustee, know that there are eyes on you. Other family members may question how you are administering the trust, and you may be asked to give an accounting of your actions and the trust assets. The best thing is to always be ready for this. When it is time to distribute trust assets, you may need even more legal assistance.

Q: Can You be the Trustee of Your Own Trust? 

A: Yes. The person who sets up the trust and transfers their property to it is called the grantor. The grantor gets to choose one or more trustees, who are legally authorized to make financial transactions on behalf of the trust, including paying debts owed by the trust and disbursing payment to the beneficiaries. You can choose almost anyone to be a trustee of your trust, including yourself. If you are the trustee of your own trust, it is important to list a successor trustee, who will take over the role of trustee after you die or become incapacitated. 

Q: Can You be the Beneficiary of Your Own Trust? 

A: Yes. A beneficiary is someone authorized to receive payment from a trust. When setting up the trust, the grantor can list any people or charities they choose as beneficiaries. This means that you can list yourself as a beneficiary. In certain situations, creating your own trust that provides an income stream to you can be beneficial for a variety of reasons. Even if your situation does not warrant a trust that provides an income stream to you, many trusts are for the benefit of the grantor during the grantor’s lifetime. The revocable living trust is a common type of trust, and this trust usually indicates that the trust is for the benefit of the grantor as long as the grantor is living.  Only at the death of the grantor do other people or charities receive the assets of the trust.   

Q: What Happens if a Dispute Arises Between a Trustee of the Trust and the Beneficiaries? 

A: By taking on the role of trustee, you assume a fiduciary duty to the beneficiaries of the trust. This means that you have a legal obligation to follow the grantor’s instructions, whether the grantor is still alive, and to act in the best interests of the beneficiaries. The best trust documents contain dispute resolution procedures to be followed if the beneficiaries allege a breach of fiduciary duty by the trustee. No matter how airtight or how ambiguous the trust document is, you should hire a lawyer to help you resolve disputes related to trust administration. 

Q: If You Have Established a Trust and Funded it, Do You Still Need a Will? 

A: Yes. Everyone needs a will, even if most of their assets have been placed in trusts or other vehicles that enable them to avoid probate. Typically, when a person sets up a revocable living trust, the trust is the beneficiary listed in the will. This is called a “pour-over” will. This way, any assets not placed in the trust during the lifetime of the grantor get placed in the trust after the grantor’s death through the probate process. Then, the trust document contains the provisions regarding distribution to the individual persons and/or charities.   

Q: What are Other Ways of Avoiding Probate, Besides Trusts? 

A: With the help of an estate planning lawyer, you can get most of your assets to pass to their intended beneficiaries without the assets going through the probate court. In addition to placing assets in a trust, you can add transfer on death (TOD) or payable on death (POD) provisions to your bank accounts and investment accounts. You can also keep assets out of your probate estate the old-fashioned way, too, namely by gifting property to the intended beneficiaries of your estate while you are alive. For example, the annual gift tax exclusion enables you to give $11 million in cash gifts over your lifetime without the need to file a gift tax return, provided that no recipient receives more than $15,000 in gifts from you in any given year. 

Legal Help Could Make the Trust Run Smoothly

As a trustee, the best thing to do is pay very close attention to the trust document. This is the expression of the grantor’s wishes. Denyse D. Kruse can provide the legal advice that helps avoid mistakes. Having a lawyer at your side to answer questions could keep you from having legal problems in the future and keep things running smoothly in the present.

Contact an Experienced St. Petersburg Trust Administration Attorney

Kruse Law helps trustees and other beneficiaries alike when they have questions about the trust administration process. Call us at (727) 256-4860 or contact us online to have a discussion about how we can assist you. Just because the trust is already established does mean that you don’t need a lawyer to help you.