In estate planning, the term “trustee” is often tossed around, but many people do not know what a trustee actually does. In short, a trustee is a person that administers the property or assets for a third party, often for a trust fund or retirement plans and pensions. While the specific duties of a trustee depend on the trust document and what assets are held in the trust, the following describes the duties of trustees and addresses a few of the more common questions people have about a trustee’s responsibilities.
What are a Trustee’s Duties?
First off, the trustee has the responsibility to safeguard the trust assets and act in furtherance of the trust’s goals. Trusts will often have a trust agreement, which specifies how a trustee utilizes the assets in the trust and specific details regarding its management. As such, the trustee must keep accurate records, file tax returns, and report any activity to the beneficiaries, those who are to receive the assets, as required by the trust. Trustees are the decision-makers for any issues that arise regarding the trust and must make the decision based on the trust agreement and with the interests of the beneficiaries in mind.