Do you know what to do after learning you are nominated as successor trustee of the person creating a trust?
What are your duties?
After the death or incapacity, the Successor Trustee is legally responsible to manage and distribute the assets according to the trust provisions. NRS 164.710. Some important tips to remember:
- You cannot mix trust assets with your own. You must keep separate checking accounts and investments.
- You cannot use trust assets for your own benefit (unless the trust authorizes it).
- You must treat trust beneficiaries the same; you cannot favor one over another (unless the trust says you can).
- Trust assets must be invested in a prudent (conservative) manner, in a way that will result in reasonable growth with minimum risk.
- You are responsible for keeping accurate records, filing tax returns and reporting to the beneficiaries as the trust requires.
Do you have potential liability?
YES. As successor trustee you have many fiduciary duties including the duty to act in the best interests of the beneficiaries. These responsibilities are fraught with possible dangers but there is an easy solution.