If your loved one or close friend just passed away, you may have a lot of questions if you are now in charge as the personal representative or successor trustee. If you are named in the decedent's documentation, you have many legal and financial duties that you may not be aware. You now have to keep accurate accounts of bills, file inventories, meet legal deadlines, pay taxes and more. Needy beneficiaries may bother you and want money before you even have a death certificate. Serving as trustee can be a daunting job for anyone, even for people with legal experience. You should, in the minimum, consult an attorney to review your duties and what your next steps are. You may also want to hire an attorney to settle your estate with you and for you as things can get very complicated very quickly.
As Successor Trustee, Do You Know Your Fiduciary Responsibilities?
A trustee is a fiduciary, placing the strictest levels of legal and financial responsibilities on the person in this role. If your family or friend have just passed away, you have legal duties that you do not even know exist. For all but the most simple trusts, it is very likely that you should have an attorney assist you in administering and finalizing matters so that you are protected and you follow your legal duties. To get you started, you should at least know the following:
- Thoroughly understand trust terms
- Investment and diversification of asset rules
- What assets you can and cannot sell
- Accurate and Thorough Accounting rules to all beneficiaries
- All Income and Estate Taxes
- Notice of trust and other legal timeframes
- Your responsibilities to work with the probate and last will and testament, if any
Personal Responsibility for Trustee
If you are administering a trust, you may be personally responsible if problems arise. Your duties are many and you may not even know where to begin. If you make a mistake, the heirs can sue you personally for your mistakes. This means that serving as a successor trustee can be a great honor, it can also be difficult in dealing with family members in an unknown legal environment.
The Florida Trust Code provides that you can hire an attorney to assist you in administering and finalizing the trust. Any legal fees would come out of the trust before final distribution. Why go it alone when you can have expert legal help assist you, make life easier and protect you?
Trustee's Fee in Florida
If you are taking on the responsibility of serving as a trustee, you are entitled to a fee for your work. Florida Statutes sets for the how the trustee's fee is calculated but there is a lot of nuance and gray area . You will also need to show how this fee was calculated and paid as part of your many responsibilities. Your attorney can help you calculate your trustee's fee, release you from accountings and liability, and more, in helping you follow your fiduciary responsibilities.
FAQs About Trust Administration
Whenever someone establishes or creates a trust, the trust property must be managed in accordance with the trust terms. Depending on the nature and value of the assets and terms of the trust, administering a trust can be fairly simple or extremely complicated.
Who administers a trust?
Every trust is managed by a trustee. The person who creates the trust chooses who will serve as trustee and who will receive the benefit of the trust property, a person known as the beneficiary. The trustee can be anyone, but the more complicated the trust the greater the need for a trustee who is familiar with the trust administration process. This is why professional trustees such as attorneys, banks or trust companies often serve as trustee.
Does the court get involved?
A trust is a private creation which does not have to be registered with a court. In fact, many people create trusts specifically to avoid the probate process upon their death.
What is a fiduciary duty?
The trustee is a fiduciary, acting only in the trust beneficiaries’ best interests and administering the trust in an impartial and reasonable manner. Following the trustee's duty is neither easy nor intuitive - that is why many successor trustees hire attorneys to help settle the estate when their loved one dies.
Do I need an attorney to administer a trust?
It is always best for the trustee to consult with an attorney in administering a trust due to the many legal duties. Whether the trustee will need to hire an attorney depends upon a number of factors such as:
- Trust size and complexity - the larger the trust, the more likely you would want an attorney to help settle the trust
- The number of beneficiaries - the more beneficiaries, the more likely a disagreement that can create further legal problems
- Outstanding bills of the decedent - the successor trustee will want to make sure outstanding bills and taxes are paid, which will likely include needing and attorney
- Difficult beneficiaries - let's face it - if the decedent's family does not get along, the successor trustee will want legal representation
- Trustee's fee - if the successor trustee wants to take a fee for his or her work, an attorney would typically help document the fee, get releases, etc.
- You do not know what you do not know - most people have never settled a trust so an attorney's help can be enormous.
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Avoid Common Trust Administration Problems
There are many ways that trustees can get into trouble during the administration of a trust. It is important that the trustee follow the exact direction of the trust. Any decision made that does not follow the trust can and probably will be challenged. Another common problem is when there is more than one trustee and they do not cooperate with each other. The result of this disagreement can hurt the administration of the trust. Also, when the trustee doesn't do the administration in the way that the law requires it can cause problems for the trustees and the beneficiaries. If you anticipate or are currently having trouble with the administration of a trust, our law firm can assist you in your fiduciary responsibility.
No Matter The Size Of the Trust, We Are Here To Help
If you are the successor trustee of a living trust in Florida, we will be able to assist you in following your fiduciary duties as trustee. Being a trustee can be very complicated and you have many legal duties that are set forth in the Florida Statutes and in case law. We will be able to help assist you in wrapping up the decedent's estate and trust, provide proper accountings to the beneficiaries, pay all taxes and bills, and more, as your counsel.
The Law Offices of DeLoach, Hofstra & Cavonis, P.A. are large enough to handle all of our clients' legal needs, yet small enough to provide the close, personal and compassionate service every client deserves. Founder Dennis DeLoach Jr. is the longest-practicing full-time attorney in Seminole, Florida, and brings to each client interaction a depth of knowledge and experience that is hard to match. D. "Rep" DeLoach III is Board Certified in Elder Law by the Florida Bar and has years of experience representing clients in probate matters, asset protection, and trust administration. To schedule your free, initial consultation, call us.