On December 5, 2014

Wrapping up our three-part blog series, Your Trustee Duties: Here’s What You Need to Know, below, we will point out some additional administrative obligations that comprise trustee duties.

Your Trustee Duties: More Administrative Obligations

Are you ready for some professional help with your trustee duties? If so, contact the Denver trust and estate planning lawyers at JR Phillips & Associates today.

Are you ready for some professional help with your trustee duties? If so, contact the Denver trust and estate planning lawyers at JR Phillips & Associates today.

In addition to registering the trust, notifying beneficiaries and overseeing the accounting for the trust, other administrative tasks that make up the trustee duties include:

  • Paying taxes – Each year, the trustee will have to make sure that taxes are paid on behalf of the trust. The trust should have a Tax ID Number (TIN), and in many cases, these tax obligations will require paying taxes at the state and federal level.
  • Appropriately managing the trust’s assets – Another important trustee duty involves overseeing the investment of the trust’s assets. In fact, this obligation will hold trustees to a higher standard of care than if these individuals were investing their own personal funds, as Colorado law stipulates that trustees are required to comply with the “prudent investor rule.”This effectively means that trustees duties regarding investing the assets of trusts require that the trustees:
    • Diversify the investments
    • Balance the need for income with the goal for long-term principal growth
    • Do not make risky investments
    • Continue to consider new investment advice and opportunities to make appropriate or good investments on behalf of the trust and beneficiaries.
  • Making the appropriate trust distributions – How the funds or assets of the trust are distributed will depend on the terms of the trust, and trustee duties require that trustees strictly adhere to these terms for making trust distributions. Generally, trust distributions may be made to pay for beneficiaries’ medical needs, educational needs or living expenses (among other things).When it comes to this administrative duty, it’s important that trustees are aware that:
    • They may have some discretion to decide when trust distributions need to (or do not need to) be made.
    • They may be held personally liable for making inappropriate or misguided decisions regarding the trust distributions.
    • They should strongly considering having an experienced attorney help them oversee the trust distributions to ensure that they are in compliance with the terms of the trust, as well as with the trustees duties.

Denver Trust Attorneys at JR Phillips & Associates, PC

When you are ready for help administering a trust or dealing with any estate planning matter, you can turn to the trust lawyers at JR Phillips & Associates, PC. We provide a thoughtful, comprehensive approach to our clients’ estate planning, elder law and other legal needs, and we take pride in helping each of our clients and their families find the best solutions for them.

Let’s discuss your options during an initial consultation. To schedule this meeting, call us at (303) 741-2400 or email us using the contact form at the top of this page.

From our offices in Denver, we serve clients throughout the southwest and southeast Metro Area, including (but not limited to) people in Highlands Ranch, Littleton, Castle Rock, Parker, Aurora, Greenwood Village and Englewood.

Categories: Trust Administration, Trustee Duties, Trustees, Executors & Fiduciaries, Trusts