People in Texas and other states often focus on retirement planning and planning for their children’s college while neglecting to engage in estate planning. Part of the reason for this is that people naturally prefer not to discuss matters related to death. However, by setting up estate plans, which may include creating trusts, people can determine what happens to their important assets when they die.
It is important for a person who is establishing a trust to know who a trustee is, what a trustee does and how to best select a trustee. This is essential since a trustee has control over a trust’s assets and is responsible for the trust’s daily operations. Each trust has to have a minimum of one trustee.
Trustees own legal title to the assets within trusts in a fiduciary capacity. This means that as an owner of the trust, a trustee can safeguard the trust, control and invest trust assets, file tax returns for the trust and pay taxes when trusts are irrevocable. The ultimate role of a trustee is to utilize and distribute a trust’s assets based on the trust’s terms, and the trustee is accountable to the trust’s beneficiaries, meaning that the trustee must account for his or her actions (or inactions) when administering the trust.
Creating trusts can be a complex part of the estate planning process. This is particularly true for those who have high-value assets or blended families. However, proper legal guidance may help people in Texas navigate the process with confidence in an effort to ensure that their assets end up in the proper hands after their deaths.
Source: lakeconews.com, “Estate Planning: Trustees, special trustees and trust protectors”, Dennis Fordham, Jan. 9, 2016