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< ESTATE PLANNING & TRUSTEES

THE STEPS OF TRUST ADMINISTRATION
- Contributed by MontereyTrust.com


Trustee accepts trusteeship and assumes control of trust assets:

1. Reviews trust and understands terms and duties; gives full consideration to duties and their ability to satisfactorily fulfill the duties of trustee.

2. Gets acquainted with the beneficiaries and helps them understand the Trustee’s role.

3. Trustee becomes aware of special requirements of beneficiaries.

4. Notes special provisions of the trust and makes arrangements to meet special needs of beneficiaries and of trust.

5. Reviews assets to determine that they are appropriate for both short and long term needs of beneficiaries. Employs professionals as needed.

Trustee performs initial administrative functions:

1. Confirms that all trust assets are titled in trust name.

2. Obtains tax identification number for trust from the IRS.

3. Opens a bank account for the trust.

4. Reviews all leases and contracts pertaining to trust assets.

5. Makes a complete inventory of trust assets and establishes the income tax basis and holding period of each assets in accordance to trust provisions and investment plan.

6. Sets up books of account for the trust.

7. Arranges for bond (individual trustees).

8. Safeguards and places trust assets under constant supervision.

9. Arranges for court formalities through the trust’s attorney, if necessary.

Trustee must adhere strictly to the code of trust ethics:

1. Must be active and not supine.

2. Must be diligent and skillful.

3. Must not leave matters to a co-trustee.

4. Must be confidential on all trust matters.

5. Must seek legal and professional advice as needed.

6. Must be guided by good faith and fairness.

7. Must be alert to danger signals.

8. Must prevent wrongdoing.

9. Must supervise persons involved with trust.

10. Must guard against undue influence.

11. Must disclose all information to beneficiaries.

12. Must not delegate authority.

Trustee has important investment duties:

1. Studies investment powers in trust for directions or restrictions.

2. Adopts an investment policy for the trust that complies with the directions given and the needs of the current and remainder beneficiaries.

3. Maintains complete, accurate and detailed records of all income, expenses, all purchases, sales and other transactions.

4. Maintains investment balance that meets the income beneficiary’s needs but produces as much growth as possible for the remaining beneficiaries.

5. Avoids any act of self-dealing or conflict of interest.

6. Exercises a high degree of diligence in carrying out the terms of the trust and keeping funds skillfully invested.

7. Maintains close supervision over any real estate or business interest and follows the management and finances.

8. Maintains proper and adequate insurance on trust assets.

SIDEBAR

TRUSTEES & TRUSTEE DUTIES

PLANNED GIVING & CHARITABLE BEQUESTS

ESTATE PLANNING FOR PETS

YOUR ESTATE PLAN

CRITICAL CHOICES FOR HEALTH CARE

FAMILY OFFICE

AGENCIES: WHO DOES WHAT



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