What Does a Trustee Do?

Whether you are considering the possibility of establishing one or more trusts, you recently established a trust, or you have been named as a trustee for a particular trust, you may have questions about how the process works. The Illinois Trust Code governs most issues pertaining to trusts, including those that a person creates as part of an estate planning process. Yet parsing the Illinois Trust Code can be extremely complicated if you do not have familiarity with trusts more broadly or with statutory language. Accordingly, our experienced Oak Park estate planning lawyers want to provide you with more information about trustees and what they do when a trust has been established. If you have further questions, or if you want to begin the estate planning process in order to create a trust, we can start working with you today.

What is a Trustee?

In order to understand what a trustee does, it is essential to understand what a trustee is, more broadly. A trustee is a party that is responsible for controlling, managing, and administering the assets in a trust. The trustee must control, manage, and administer the trust for the benefit of the beneficiaries who have been named or identified.

In short, a trustee handles the assets that are held in a trust.

Duties of a Trustee

Under Illinois law, a trustee has many significant duties that are outlined in the Illinois Trust Code. A trustee’s duties include the following:

  • Duty to administer the trust: Once the trustee accepts the trusteeship, the trustee must “administer the trust in good faith, in accordance with its purposes and the terms of the trust”;
  • Duty of loyalty: Trustees have a duty to administer trusts only for the benefit of the beneficiaries (to whom they have a duty of loyalty) and cannot administer the trust in any way that benefits the trustees themselves unless a limited exception applies, and the trustee cannot commingle any of the trust assets with their own assets;
  • Duty of impartiality: When trusts have two or more beneficiaries, trustees must act impartially toward the beneficiaries and treat them equitably when it comes to investing, managing, and distributing the assets of the trust; and
  • Duty of prudent administration: Trustees must “administer the trust as a prudent person would, by considering the purposes, terms, distribution requirements, and other circumstances of the trust,” which involves exercising “reasonable care, skill, and caution.”

Illinois law makes clear that a trustee does not have the authority to — and has a duty not to — designate trustee duties to another party except in limited circumstances.

Contact an Oak Park Estate Planning Lawyer Today

Do you have questions about establishing a trust or other aspects of the estate planning process? Whether you are considering creating a particular type of trust or you have questions about trustee duties, our firm is here to assist you. One of our experienced Oak Park estate planning lawyers can talk with you today. Contact the Emerson Law Firm for more information about our services.



See Related Blog Posts:

How to Choose an Executor of Your Estate

What is a Codicil?

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