While creating a trust is critical for many people and their loved ones, it may seem complicated at first. There are also important decisions that must be made throughout the process that will impact the beneficiaries and the assets within a Colorado estate plan. One such choice is who to designate as the successor trustee to a revocable living trust. A successor trustee is appointed to take over the trust when the creator of the trust—who normally serves as the initial trustee—becomes incapacitated or dies. Because the successor trustee has important responsibilities, it is important to choose the right person to serve this role.
Initially, the person creating the revocable trust normally acts as the trustee. However, in an irrevocable trust, someone else must be appointed to this position. The successor trustee’s role only comes into play when the initial trustee can no longer manage the trust. When the initial trustee either passes away or becomes incapacitated, the successor assumes control of the trust.
While a successor trustee’s role may seem similar across all successor trustees, this is not the case. The exact duties the successor trustee must undertake depends on the terms set in the trust agreement. The successor trustee often appraises the value of all the assets in the trust, pays all taxes, and sets aside funds for expenses the trust may incur. Regardless of the specifics of the trust, the main duty of all successor trustees is to handle the transfer of assets to the beneficiaries and ensure that they follow the terms written in the trust. Unlike an estate executor, a successor trustee’s role may continue for years after the initial trustee’s passing. For example, the initial trustee may leave a grandson assets that they do not want him to receive until his 25th birthday. If the initial trustee passes when the grandson is 14 years old, the successor trustee must safeguard his inheritance until his 25th birthday.
Because a successor trustee’s role is immensely important, the initial trustee should think carefully about who they name to serve in this position. As the position may last for years, the initial trustee should ensure the person they choose is up to the task—along with having experience in managing a trust and its assets. Further, naming a successor trustee is a critical decision, and Coloradans should contact an experienced estate planning attorney who can walk them through how to pick the right successor trustee for them.
Contact a Colorado Estate Planning Attorney
If you or a loved one is interested in creating a revocable living trust—or need help picking a successor trustee—called the Colorado estate planning attorneys at the Braverman Law Group. With years of experience creating a variety of estate planning documents, from revocable living trusts to wills, we will make the right estate plan for you and your family. Contact us today at 303-800-1588 to schedule a free consultation with one of our attorneys. You can also reach out to us through our online form, and one of our attorneys will get back to you as soon as possible.