The Duties of a Successor Trustee

Duties of a Successor Trustee

Being named as a successor trustee feels like a huge responsibility. It can also feel confusing. Luckily, you don’t need to do anything right now – the only time you have to act is when the trustee of a trust passes away or if the person becomes incapable of managing their financial affairs. In the meantime, understanding the duties of being a successor trustee is important for future events.

The following are the main duties of a successor trustee:

1 | Settling a Trust

One of the primary duties of a successor trustee is to settle the deceased’s trust and continue managing it after the person’s passing. Of course, the exact duties that you’re expected to fulfill would depend on the terms of the formation documents. 

2 | Locating Trust Assets

The successor trustee is responsible for locating and protecting the trust assets. This means that even after you die, it is the responsibility of the successor trustee to maintain your assets.

3 | Collecting Life Insurance Policies

It is the duty of a successor trustee to collect life insurance policies, as well as annuities, and retirement accounts. This means making sure that your wishes as reflected on the beneficiary designations you left or your trust documents are honored. It is the success trustee’s responsibility to uphold these policies.

4 | Coordinating With Those Responsible for Trust’s Estate

If probate is necessary, then the successor trustee is responsible for meeting with the personal representative or executor of the estate. Oftentimes the trustee will also be named as the executor of your probate estate in your will.

5 | Obtaining the Date of Death Values

As the successor trustee, one duty includes obtaining the date of death values for the assets of the trust. This will include the appraisals of the real estate and business interests. 

6 | Identify The Trust’s Creditors

One of your key duties as a successor trustee is identifying the creditors of the deceased and paying off  any debts owed. In addition, the successor trustee is  responsible for determining the income tax or estate tax liabilities for the deceased. 

7 | Prepare Ongoing Expenses

Going forward, the successor trustee is expected to prepare and file all of the required income tax and estate tax returns. The successor trustee will also pay the ongoing expenses of administering the trust until it is terminated. The remaining property will then be distributed to the beneficiaries, which the successor will oversee.  In some cases, you may have set up continuing trusts for beneficiaries and the successor trustee will manage those trusts and the assets in them for the duration of the trust.

Named a Successor Trustee, but Have Questions?

Smith Barid has many years of experience in helping people understand what goes into being a successor trustee. Smith Barid has expertise in estate planning, elder law, probate/trust administration, and more. If you need help preparing a trust, questions about choosing a successor trustee, or if you’ve been named but need to know where to turn, give us a call or contact us for trusted guidance.

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