It is a legal relationship where one party owns the property for giving the benefits to another party. The person who is creating the trust is referred as the “Settlor,” “Grantor” or “Trustor.” The Trustor gives the property to the trustee. The Trustee holds the legal title to the trust property. Trust has two categories – testamentary or living trusts.
A Testamentary trust comes into action when the will’s creator, known as Testator is no more. A living trust comes into action when the trustor is alive and holds all the assets and beneficiaries; everything is transferred to family members and loved ones only after his death. A living trust has 2 categories – irrevocable and revocable trust.
One of the most crucial things about comprehensive estate planning is Trust. Whether you’re choosing to create a testamentary trust or a living trust, one thing you should take care while creating your trust is - having a Trustee. A common mistake everybody do while appointing a trustee is selecting a loved one without noticing his/her capabilities. A law Probate in Riverside County may help you in deciding the Trustee for your trust who can administer your trust proficiently.
Trustee – Duties & Responsibilities
The Trustee of trust has to manage invests and administers the trust according to terms formed by Trustor. A Trustor often appoints a Trustee who doesn’t have a clear understanding of the numerous duties and responsibilities that he has to follow:
- Manage and protect the assets – Trust assets can include anything that is valuable. The Trustee is the only person responsible for managing everything related to the trust.
- Surviving with trust terms – the Trustee is bounded within the terms of trust except they are illegal, impossible, or wrong.
- Honor the purpose of trust – Most trusts state the need and purpose of creating it. The Trustee should respect the purpose of the trust while taking any decision.
- Use “Prudent Investor Standard” – all the investments done by a Trustee should be made by keeping in mind the “Prudent Investor Standard” which means guarding the trust while keeping in mind the risks and ways to achieve and overcome it.
- Keeping the Trust beneficiary informed of trust business – A Trustee had to stay informed its trust about the company on a regular basis and respond to them on a daily basis, discussing their queries and doubts.
- Disagreement of decision – disputes among the beneficiaries may happen at some point. The Trustee should stay neutral in the arguments and try to resolve the conflicts before it could it rise. If the trust has future beneficiaries, then the decision on the dispute should be taken while considering all the positive and negative aspects in mind.
- Making Flexible choices – A Trustee has the power and authority of taking flexible decisions related to investment or disbursements. While using this authority, a Trustee should be guided by the top interests of the beneficiaries.
- Preparing and Paying Trust taxes – trust is a different legal entity. As such, a trust pays tax. A Trustee must complete all the tax return for the trust every year and makes sure that every tax on behalf of trust is paid on time.
If you’re having additional concerns or questions related to the choice of Trustee for your trust, contact the knowledgeable probate in Riverside County from the Law Office of Michael. C. Maddux. Also, you can schedule an appointment for meeting us.
For more information, contact Probate Attorney in San Bernardino.