Many people agree to administer a trust without having the slightest idea of what it entails. Most believe it to be a simple matter of distributing the trust assets, but it involves much more. A trustee assumes a fiduciary relationship with the beneficiaries of a trust and, as discussed under the article “A Trustee’s Fiduciary Responsibility,” there is an extensive array of legal duties and obligations imposed on a trustee. As a general rule, administering a trust is a fairly formal process in which the trustee must undertake the distribution the trust assets without the benefit of court guidance. If the trustee does not follow the rules of fiduciary responsibility, the trustee may subject the trust to loss and damage, and may incur personal liability in some instances.

In administration, the trustee must take control of the trust assets including real and personal property as well as various financial and investment accounts. Properties must be managed. Management may be directed by the terms of the trust, but if the trust is silent, there are laws in California that govern the management of a trust. There are notices that should be given including a notice to beneficiaries and heirs and a separate notice to creditors.

During the administration of a trust, the trustee has a duty to keep beneficiaries informed about the administration. The trustee should keep detailed records of all assets that are in the trust, all income received, and all expenses of the trust. A trustee has an obligation to see that all tax returns required are filed and all taxes are paid. A trustee should consult an appropriate professional such as an accountant or an attorney during the administration of the trust.

This is only a brief outline of the responsibilities of a trustee. Our Marin County probate lawyers have prepared a guide for trustees to use in administering a trust. We work closely with our trustee clients to assist them in administering the trust in a proper and efficient way. We look forward to working with you.