This is a brief Trust Administration Checklist for individuals serving as the trustee of an estate planning trust, such as a living trust or another type of trust, after the death of the settlor, also sometimes referred to as the grantor or trustor. This Trustee Checklist provides a list of steps typically completed during the process of trust administration. The steps required to administer an estate planning trust vary depending on many factors, such as the size of the trust, the state where the trust is administered, the terms of the trust, the number and type of trust beneficiaries, and the types of assets held in the trust. Although some items on the Trustee Checklist may not apply to the trust you are settling, review all items on the list carefully anyway. Consult a trust attorney or probate lawyer before taking any action as trustee to ensure you comply with applicable Trust Law and the provisions of the trust.
Trustee Checklist1. The first step in administering a trust is to gather all official documents and records you will need during the process. Collect all estate planning documents and other important records of the deceased, including:
Last will and testament, trust documents, including any trust amendments and restatements, and the Certification of Trust;
Several certified copies of the death certificate for the decedent from the funeral home or vital records office;
Life insurance policies, annuity contracts, pension plan statements, IRA and 401k account statements, and related policies and retirement plan documents;
Birth certificate and social security number;
Marriage license, divorce decree, and property settlement agreement if applicable;
Most recently filed federal and state income tax returns;
Documentation of military service, such as serial number and veteranís discharge papers;
Financial statements, account statements, and other financial records.
2. If you are also serving as executor or personal representative of the deceased personís estate, you may want to review the Pennyborn.com Executor Checklist for estate administration for a list of steps required to settle an estate.3. Review the trust agreement thoroughly for information regarding your powers as trustee and the limitations on your authority. Post executor bonds if required. Consult a trusts and estates attorney to ensure you fulfill your duties as trustee in accordance with applicable law.If the living trust contains marital deduction provisions or bypass trust provisions, it is essential to consult an attorney and a tax professional before taking any action regarding trust property.4. Secure all trust property. Review the contents of any safe deposit boxes held in the name of the trust. Create an inventory of property, accounts, and other assets in the trust.5. Meet with an attorney and tax advisor. If the trust property includes stocks, bonds, limited partnerships, a business, rental property, or other investments of significant value, consult a financial planner in addition to an attorney and tax professional. See find a financial planner. Manage trust investments prudently. You may need to open a brokerage account or other investment account to hold securities owned by the trust or invest trust funds. See how to open trust account.6. Establish a bank account for the trust.7. Apply for insurance proceeds, employment compensation, government benefits, and other types of benefits that are payable to the trust, such as:
Death benefits on a life insurance policy; and
IRAís, 401kís, 403bís, 401aís, and pension plans.
8. If you plan to seek beneficiary consents, waivers or releases, consult an attorney about drafting enforceable language based on applicable state law. Review our article on Trust Beneficiary Release.9. Maintain accurate records, accounts, and financial statements regarding all trust income, expenditures, sales, transfers, and transactions. You will need these records to prepare a Trust Accounting Form.10. Review the grantorís estate planning documents to determine if he or she disinherited an heir or left only nominal amounts to heirs that may have expected more substantial inheritances. Identify any potential trust dispute or claim that may be brought by a disgruntled heir. See will and trust disputes. Consult an attorney regarding the best way to handle any potential claim against the trust or the trustee.11. Pay debts and expenses regarding trust property. Pay federal, state, and local tax obligations of the trust and file required tax returns with the help of a tax advisor. For a list of tax returns you may be required to file, see tax returns due.12. Complete a trust accounting and provide the accounting to beneficiaries if required. See living trust accounting. If a distribution is being made at the same time, the trustee may enclose the accounting report with the trust distribution letter.13. Distribute trust income or property to trust beneficiaries according to terms of the trust agreement. Complete transfer deeds and other change of title documentation. Document distributions to beneficiaries in a formal letter indicating that a final distribution has been made. For information on how to write a final distribution letter to beneficiaries of the trust, go to our Trust Distribution Letter form.14. Prepare documentation closing the trust. See how to end a trust.This is only a brief trustee checklist. It is not a comprehensive list of the duties of a successor trustee of a living trust. If you are trustee of another type of trust, consult an estates and trusts attorney for guidance.
Related Articles for Trustees
It is possible to perform your duties as a trustee while saving money on legal fees by performing many of the steps involved in administering a trust on your own. However, it is important to understand which steps require the involvement of an experienced attorney to avoid mistakes for which you may be liable as trustee. Find an attorney that is willing to work with you to keep
trust administration fees low but advise you on critical steps in the process. To learn how to discuss these fee arrangements, read our article on
finding an attorney.
Many living trusts are drafted to take full advantage of tax saving provisions under existing law. However, to the lay person, terms like bypass trust or marital deduction can be extremely confusing. If you attempt to administer a trust without having a full understanding of these trust provisions, you could incorrectly distribute property from the trust and create a tax problem or a will and trust dispute among the beneficiaries. To learn more, read our article on the
marital deduction and review our free Guide to Living Trusts.The Trustee Checklist was updated on May 9, 2019.
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