The Duties Of A Trustee In Missouri

The trustee is a crucial part of the process of using a trust to pass on all or part of an estate to the intended beneficiaries. It is the trustee’s job to make sure the trust operates according to the grantor’s stated specifications and in the beneficiaries’ best interests.

More specifically, as a trustee, you are responsible for several tasks, which can be grouped into six categories:

Immediate Steps

For many types of trusts, the grantor’s death triggers the trustee’s powers and responsibilities. When that happens, the trustee should immediately review the trust instrument and its provisions. They should meet with the attorney who drew up the trust, as well as other professional advisers such as an accountant. They should also meet with their co-trustees, if any, and the beneficiaries. The trustee will need to take an inventory of the assets contained in the trust to make sure they have an accurate picture of what they are responsible for.

Trust Management

The trustee’s ongoing duties include:

• Proper management of the trust assets. This includes monitoring investments and making changes as needed.
• Collect income and dividends from assets and handle them as instructed, such as by disbursing them to beneficiaries or reinvesting them.
• Defend the trust and beneficiaries against any challenges.
• Adhering to the instructions contained in the trust instrument.
• When necessary, making decisions for the benefit of the trust and beneficiaries according to the trustee’s best judgment.

Tax Responsibilities

The trustee is also responsible for paying taxes owed based on assets in the trust, such as property taxes on a house or capital gains taxes on investments. They also should make financial decisions to minimize the tax impact on the assets so that the maximum benefits go to the beneficiaries instead. Besides filing tax returns, the trustee needs to issue tax reports to the beneficiaries.

Disbursements

Payments out of the trust assets for which the trustee is responsible include paying the trust administration expenses. Depending on the terms of the trust, the trustee could be required to pay the beneficiaries’ expenses. They must also be prepared to describe the trust income, principal or both to the beneficiaries.

Record-Keeping

The trustee must maintain accurate and up-to-date investment records, tax records and disbursement records and issue regular statements to all interested parties, such as the co-trustees, beneficiaries and the accountant.

Periodic Reviews

Part of the trustee’s job is to meet regularly with the beneficiaries to reevaluate how the assets in the trust are performing and whether the trust’s purpose is still relevant. You will also hold periodic meetings with the accountant, your attorney and other professionals as needed. You are responsible for making any changes to solve problems that come to light at these meetings, though your trust administration lawyer can help. You can see a visual of the duties of a trustee here.

As you can see, being a trustee is a very important and complicated job. Fortunately, you do not have to try to handle it alone. We at Schormann Law Firm, LLC, advise trustees in and around St. Peters and perform administrative duties on their behalf. Contact us at 636.875.7653 to schedule a consultation.