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Trustee’s Duties in Morris County

Because probate proceedings in New Jersey can be lengthy and expensive, many estate planners chose to establish trusts. A properly structured trust not only avoids probate, thereby maintaining the privacy of the financial arrangements, it can also minimize estate taxes and help to plan for incapacity. A trustee’s duties include carrying out the terms of the trust upon the trustmaker’s passing, which makes it wise to work with an experienced trust and estate attorney.

At E.A. Goodman Law, LLC, located in Morristown, we guide trustees through the complicated trust administration process in New Jersey. Our dedicated trust and estate attorneys advise trustees on fulfilling their fiduciary duties and distributing the trust assets to the rightful beneficiaries. In the event of trust-related disputes, we provide our clients with powerful legal representation when they need it most. When you become our client, you will have confidence knowing that your interests will be protected. 

What are the trustee’s duties in the trust administration process?

The first thing to know is that a trustee is considered to be a fiduciary, which places you in a position of trust with the beneficiaries. In short, as a trustee, you must adhere to the highest ethical standards and can be held liable for mistakes or misconduct. In particular, you are obligated to act in the best interests of the beneficiaries and preserve the value of the trust assets. 

At E.A. Goodman Law, LLC, we assist trustees in carrying out their important duties. A trustee’s duties may include:

  • Notifying beneficiaries and other interested parties of the trustmaker’s (grantor’s) death
  • Creating an inventory of the trust property
  • Arranging for an appraisal of the trust assets
  • Transferring property into the trust if necessary
  • Obtaining tax ID numbers
  • Filing estate tax returns
  • Preparing trust accountings
  • Distributing the assets to the beneficiaries

The complexity of administering a trust ultimately depends on the value of the trust assets. In a trust with significant assets, for example, principal and income may need to be distinguished according to the terms of the trust. In some cases, income only may be distributed to one beneficiary at first, while the principal is subsequently distributed to that same or another beneficiary. It is also common for an inheriting spouse to receive income, while the principal is held by the trust, only to be used for a medical or another emergency.

As you can see, properly administering a trust requires you, as the trustee, to be dependable and capable. This is especially so if conflicts to arise among the beneficiaries, further complicating the trust administration process. 

Founding attorney Elga Goodman has a well-earned reputation for helping trustees navigate the trust administration process in New Jersey and avoiding the pitfalls that could result in trust litigation. In the event of disputes, our legal team has the skills to reach negotiated settlements, but we also know our way around the courtroom.

Preparation of Trust Accountings

A properly structured trust can typically be administered without going to court. However, trustees are required to provide annual trust accountings to beneficiaries who are entitled to receive distributions of income and principal during the accounting period. Generally, a trust accounting must disclose:

  • Assets and liabilities of the trust
  • Disbursements of principal and income
  • Trustee’s compensation
  • Agents (accountants, financial advisors) hired by the trustee

A trustee must act impartially on behalf of all the beneficiaries and fully disclose any actions that have been taken. This requires the trustee to maintain thorough records and provide a clear accounting so that beneficiaries are fully informed. 

You should know that a trust accounting is not the same as a tax or financial accounting typically prepared by accountants who may be unfamiliar with the exacting requirements of the New Jersey Probate Code. The best way to avoid mistakes that could potentially result in litigation is to consult an experienced New Jersey trust and estate attorney who will work to create a balanced trust accounting. 

At E.A. Goodman Law, LLC, we will work closely with you to ensure that trust assets are properly titled, appropriate records and receipts are retained, and that all beneficiaries receive proper trust accountings. 

Contact our Experienced New Jersey Trust and Estate Lawyers

If you have been named as a trustee, the best way to carry out your duties is to consult E.A. Goodman Law, LLC. Our trust and estate attorneys will provide you with guidance that can help you avoid costly mistakes, legal liabilities, and potential financial penalties. Our legal team also works to resolve trust-related disputes through arbitration and mediation. Above all, we are committed to protecting your interests. Please contact our office today to set up a consultation.