Satran & Associates

P: 508-255-5353

F: 508-255-9243

Estate Planning Newsletter
  • A Trustee's Role
    Every trust must have a trustee to properly administer the elements of the trust. Trustees can be individuals, financial institutions or even organizations. A trustee follows the precise instructions of the trustor (or the... Read more.
  • Revocable Bank Deposit Totten Trusts
    A decedent’s assets may be transferred upon their death to their heirs or other beneficiaries through probate. “Probate” is the legal process by which a court determines who receives a decedent’s assets under... Read more.
  • Tax Deductions for Donations of Property to Charities
    The U.S. government has long encouraged citizens to contribute to charity. One method of encouraging philanthropic giving is the allowance of deductions from income for federal tax purposes for donations to “qualified”... Read more.
  • Whether Children Conceived After the Death of a Parent are Entitled to Benefits
    Several states refer to children who are born or adopted after the execution of a parent’s will and omitted from the provisions of the testamentary instrument as “omitted” or “pretermitted” children. In the... Read more.
  • The Delaware Series LLC: Advantages and Pitfalls
    Limited Liability Companies (“LLCs”) are a form of business ownership which is a separate legal entity much like a corporation. An LLC is treated like a partnership for tax purposes and like a corporation for liability... Read more.
Estate Planning News Links

A Trustee's Role

Every trust must have a trustee to properly administer the elements of the trust. Trustees can be individuals, financial institutions or even organizations.

A trustee follows the precise instructions of the trustor (or the trustor’s authorized representative), and also adheres to rules imposed by law.

Prudent Person Rule

Trustees are subject to the “prudent person” rule. This rule states that trustees should use the same standard of care and diligence that any sensible person would use in managing property. Additionally, a trustee should make a strong effort and utilize all of his/her skills in caring for the trustor’s property.

Responsibilities

A trustee has the duty to accomplish the following:

  • Administer internal affairs
  • Manage property
  • Invest property
  • Distribute income and principal
  • Deal with beneficiaries impartially
  • Use discretion over the important areas of the trust

Beneficiaries

A trustee has a fiduciary duty to the trust’s beneficiaries as well as to the trustor. In dealing with beneficiaries, a trustee should:

  • Use property only for the beneficiaries’ interest
  • Disclose important facts
  • Provide additional information related to the trust upon request of the beneficiaries

Improper Activity

A trustee should not:

  • Use trust property for personal benefit or purposes not related to the trust
  • Acquire interests in conflict with those of the beneficiary
  • Sell property to himself/herself
  • Delegate his/her duties to another individual

If a trustee is suspected of improper activity or misuse of his/her discretionary decision-making powers, the court will review the trustee’s actions after a petition is filed by the trustor or any beneficiary. A trustee may also petition the court for a review if beneficiaries question his/her decisions.