Do you know what your responsibilities are if you are acting as a trustee of a trust or as executor of an estate? If you are acting as either, then you are a “fiduciary” for the beneficiaries of the trust or the estate. This job can be short-lived (e.g., one year or less where you are administering a trust or probate estate which provides for outright distributions to all beneficiaries), or can go on for many years (e.g., where you are acting as trustee for a minor child or children until they reach the age of 30). In any case, it is not an easy job, and can be even more challenging when you are both a beneficiary and the fiduciary for the trust or estate.
As a fiduciary, you must act on behalf and in the best interests of all of the trust or estate beneficiaries. So what does this mean? It means that:
- You must follow the terms of the trust or will that you are administering, even if you don’t necessarily agree with or like what document says.
- You cannot take an action that benefits one beneficiary at the expense of another.
- You must account for all of your actions that you take on behalf of the trust or estate and accurately disclose such actions to the beneficiaries.
- You must use due care, competence, and diligence at all times you are acting in this fiduciary capacity, including seeking professional investment, tax and legal advice, before taking actions, even if you would not use the same care, etc. when acting on your own individual behalf.
- You can only take actions authorized in the documents or under state law.
If you fail to act appropriately as a fiduciary, or are dishonest or not forthcoming in your dealings with the beneficiaries of the trust or estate, a beneficiary may sue you personally for damages, including attorney’s fees and costs, and a court can remove you as the trustee or executor.
If you are acting as a trustee or executor, and would like assistance in meeting your fiduciary obligations, Waltz, Palmer & Dawson, LLC can help. We will guide you through the process of administering the trust and/or estate, from the very beginning when the death occurs, to the very end when final distributions are made to the beneficiaries.
Should you have any questions about acting as a trustee of a trust or as executor of an estate, or would like to schedule a free initial consultation, please contact Waltz, Palmer & Dawson, LLC at (847)253-8800 or contact us online.
Waltz, Palmer & Dawson, LLC is a full-service law firm with various areas of service to assist your business, including: Employment Law, Intellectual Property, Commercial Real Estate, Business Immigration, Litigation and general Business Law services. Individual services include Estate Planning, Wills and Trusts, Probate, Guardianship, Divorce and Family Law, Collaborative Divorce & Mediation.
This article constitutes attorney advertising. The material is for informational purposes only and does not constitute legal advice.
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