Successor Trustee Checklist?

[Midpack]

We've just named a new backup Successor Trustee, and we want to provide some guidance on what her tasks will be when we're both gone. Unfortunately the Trust documents aren't good guidance, they're more of a reference. I assume Estate Attorneys write trusts so Executors/Successor Trustees are overwhelmed and therefore inclined to hire them for guidance, among other reasons.

The best "checklist" I've found so far is Successor Trustee Step-by-Step Checklist | Trust & Will and it's no great IMO.

Any suggestions on a better guide would be welcome.

 

[pb4uski]

I think it is very situational. In the case of my mom and dad's trusts, it was pretty straight forward, in part because I was already paying mom's bills and managing all trust property when she passed so I was very familiar about what was in the trusts.

In our case, each trust had financial assets and 1/2 interests in a commercial property and a vacation home.

The financial assets were distributed to the 5 beneficiaries within 30 days of Mom's passing and was straight forward... have each beneficiary set up brokerage accounts with Schwab and then I just gave Schwab instructions on what assets to into each account. There was a small glitch in that certain CUSIPs had a minimum quantity to be transferred so we made a few small adjustments. The other thing the I had to do was to ride herd that the step-upped basis was done properly (it wasn't and I had to work with Schwab to have it corrected).

The commercial property was sold to the single tenant and the sales proceeds less a cartain amount withheld was distributed to the beneficiaries.

The summer home was more complicated. The 5 of us agreed that we wanted to keep it rather than sellbut wanted a structure that would allow flexibility in future ownership. We established a family LLC and the trusts transferred the property into the LLC. Each beneficiary owns 20 of the LLC's 100 membership units. The aforementioned amount withheld provided working capital for the summer home's expenses. Each member was granted a 2 week block of time from July to mid-September and the blocks rotate from year to year, so if you have Bock 1 in 2025, you'll have block 2 in 2026, etc. The LLC allows for members to sell all or part of their units but gives the LLC right of first refusal and the other members right of second refusal. If neither the LLC (all members excluding the selling member) or any other members want to buy then the units can be offered to outsiders.

At this point all of the trusts assets have been distributed to the beneficiaries or to the LLC in exchange for units for each beneficiary. The only thing left to be done is to file a 2025 trust tax return and K-1s to the beneficiaries for 1-month of real estate income and the gain on the sale of the commercial property at the end of January 2025.

 

[More Cowbell]

We've just named a new backup Successor Trustee, and we want to provide some guidance on what her tasks will be when we're both gone. […]

Any suggestions on a better guide would be welcome.

I got The Trustee’s Legal Companion: A Step-by-Step Guide to Administering a Living Trust by Hanks and Zola. Published by Nolo Press.

 

[Slim11]

Its a good list. Just make sure you tell them to get like 30 copies of the death certificate. A lot want originals, some will accept a scanned copy. Its easier to do up front then get them later when you need them. And they may have to be given to benificarys outside the trust that are on accounts.

 

[CRLLS]

When DMIL passed, DW and her sister were named co-successor trustees and co-executors. DW had the NOLO book mentioned. Her co-ST knew nothing. We had some friends who had found an attorney who helped them thru their time. The attorney guided them in what to do rather than doing and charging for everything. DW contacted the attorney, they talked and in the end hired her to guide DW and her sister thru the process. The attorney did do some things rather than having them do it. It took a large weight off their shoulders to know they were doing everything properly. In the end, the total cost for the attorney's service was well under 1% of the combined estate/trust. Well worth the cost IMO if you can find a similar attorney, especially if you haven't done it before.

 

[Midpack]

I got The Trustee’s Legal Companion: A Step-by-Step Guide to Administering a Living Trust by Hanks and Zola. Published by Nolo Press.

Just put on hold at my local library, thanks. Turns out I will be a trusted this year, and coach our successor trustee also.