What is the role of a trustee? Let The Law Office of Paul Black help understand the role of a trustee. We have the information you need. Call us today.
Author: Paul Black
Paul’s experience as the son of two parents with big health challenges is what led him to the work he does today and gives him first-hand knowledge of the challenges that many caregivers and family members face. After graduation from GSU Law, Paul was chosen from dozens of applicants nationwide as one of three 2010-2011 Borchard Foundation Law & Aging Fellows. Paul has been named as a SuperLawyers “Rising Star” in the area of Estate Planning and as a member of Georgia’s “Legal Elite” by Georgia Trend magazine. Published on: June 14, 2023.
What Is the Trustee’s Role?
It’s never too early to start planning for your family’s future.
If you have questions, I’m here to help. There is no commitment and we provide free initial 15-minute phone calls. We look forward to meeting you.
Contrary to popular belief, estate planning trusts are not just for the rich and famous. Without estate planning, either through a will or a trust, your assets will be distributed by the probate court, which may not be what you would have wanted.
Establishing a trust and appointing a trustee can ensure that your loved ones are looked after and your assets are appropriately managed.
A trustee has a fiduciary duty to act in the beneficiaries best interest and in accordance with the trust document. They are ultimately responsible for the trust’s continuity.
Choosing a trustee who can put personal interests aside is crucial. Without playing on words, a trust should have a trustworthy trustee! A trustee is expected to be absolutely transparent in managing and distributing trust assets.
If you have any questions about estate planning and wealth protection, The Law Office of Paul Black can help. We can help you make a living trust and answer all your questions. We have years of experience and can assist you in ensuring that your family and loved ones are well looked after when you pass on.
What is a Trustee?
A trustee manages and oversees a trust’s administrative and financial affairs and holds legal title to the trust’s assets. Trustees administer the trust following the trust creator’s wishes and the instructions set in the trust agreement.
Usually, the creator of a revocable living trust, known as a grantor, is also its trustee. After the grantor’s death, a successor trustee is appointed, which may be a family member or a professional trustee.
A professional private trustee can be a bank or trust company, known as a corporate trustee, or an individual, such as an attorney or a financial advisor.
What Are the Duties and Responsibilities of a Trustee?
The trustee’s duties are usually outlined in the trust document to ensure the trust property is administered according to the grantor’s wishes.
In addition, GA Code § 53-12-261 gives trustees the power to exercise the following:
-
All powers that an unmarried competent owner has over individually held trust property
-
Any other powers necessary for the effective investment, management, and distribution of trust property
Under Georgia law, the duties of a trustee may include the following:
-
Marshaling and creating an inventory of the trust’s assets
As soon as the trustee is appointed, their first duty is to identify, collect, and value the assets held in the trust.
-
Keeping track of costs and earnings
The trustee has an administrative duty to transparently record all financial transactions related to the estate trust.
-
Distributing assets to trust beneficiaries
The trustee is required to distribute assets to beneficiaries in an impartial manner and per the trust agreement.
-
Allocating money to income beneficiaries
In some trusts, such as unitrusts, the trustee must pay eligible beneficiaries an income as described in the trust agreement. If you are wondering, what is a unitrust and how does it work? Our attorneys at the Law Office of Paul Black are available to answer all your inquiries.
-
Making investment decisions for the trust
The trustee can invest and reinvest in any property deemed appropriate, such as stocks, bonds, mortgages, or other securities in or outside the United States.
-
Trust administration
Trustees can sell, trade, issue options on, divide, or dispose of any property. They may also employ and compensate agents, accountants, brokers, attorneys, and other professionals to assist in the administration of the trust.
-
Reporting income and filing tax returns
Trustees must pay estate property taxes, debts, assessments, fiduciary remuneration, and other expenditures involved in collecting, caring, administering, and protecting the trust.
Liability and Legal Obligations of a Trustee
Trustees have legal obligations to the trust and can face legal repercussions if they breach fiduciary responsibilities or disregard the law.
According to GA Code § 53-12-300, a trustee may be in breach of trust if they violate any obligations owed to the beneficiaries. In this case, the beneficiary has the right to:
-
Recoup losses
-
Compel the trustee to exercise their obligations as trustee
-
Force the trustee to rectify a breach of trust by payment of money or restrain the trustee from committing a breach of trust
-
Remove or suspend the trustee
-
Appoint a temporary trustee to take control of trust property and run the trust
-
Limit or refuse the trustee’s pay
A trustee who commits a breach of trust will be personally liable for the following damages as mandated by the GA Code § 53-12-302:
-
Loss or depreciation in value of the trust property
-
Any profit made by the trustee through the breach of trust
-
Any amount that would reasonably have accrued to the trust or beneficiary if there had been no breach of trust
-
At the discretion of the court, expenses of litigation, including reasonable attorney’s fees incurred
Trustees can purchase trustee liability insurance to financially protect themselves against claims or litigations. However, the best way for trustees to protect themselves is by safeguarding the interests of the beneficiaries and upholding their legal responsibilities.
The Law Office of Paul Black Can Help
Appointing the right trustee is a critical decision, as it will affect your family members and their future. If you are still considering your options, you may want to contact our estate planning attorneys for advice.
Paul Black from the Law Office of Paul Black has years of experience in estate planning and managing trusts. He can help you in many ways, including:
-
Planning your estate
-
Establishing a trust or creating a will
-
Managing your trust as your professional trustee
-
Changing your irrevocable trust
Wondering how can an irrevocable trust be changed? Our skilled legal team is familiar with the nuances of irrevocable trusts and can help you amend yours.
If you are ready to appoint a professional private trustee who is trustworthy, experienced, and knowledgeable, don’t hesitate to contact us!
