When someone creates a revocable living trust, much of the focus is understandably on avoiding probate and planning for the future. But after the person who created the trust dies, someone still has to administer it.
That responsibility usually falls to the successor trustee.
Trust administration can involve locating assets, reviewing the trust, notifying beneficiaries, managing property, addressing expenses and taxes, maintaining records, preparing accountings, resolving creditor issues, and eventually distributing assets to beneficiaries.
At Gold Legacy Law, PLLC, I advise trustees and beneficiaries throughout Florida trust administration. Below are answers to 50 questions I frequently encounter about administering a Florida trust.
Florida Trust Administration Basics
1. What is trust administration in Florida?
Trust administration is the process of managing and ultimately distributing trust property according to the trust document and Florida law. After the settlor dies, the successor trustee typically assumes responsibility for administering the trust.
2. Is trust administration the same as probate?
No. Trust administration and probate are different processes. Probate is generally court-supervised administration of probate assets. Trust administration generally occurs outside court unless litigation or another issue requires judicial involvement.
3. Does a trust avoid probate in Florida?
Assets properly transferred into a revocable living trust can generally be administered through the trust rather than probate. However, assets left outside the trust may still require probate.
4. Does a trust have to be filed with the court after someone dies?
Generally, a Florida trust is not automatically filed with the probate court simply because the settlor dies. Trust administration is often a private process.
Court involvement may become necessary when litigation, interpretation, removal of a trustee, or another disputed issue arises.
5. Does a Florida trust become public after death?
Generally, no. Unlike a will admitted to probate, a trust does not ordinarily become a public court record merely because the settlor died. This additional privacy is one reason some families choose trust-based estate planning.
6. Does a trust become irrevocable when the person who created it dies?
A revocable trust generally becomes irrevocable upon the settlor's death. At that point, the successor trustee must administer the trust according to its terms rather than simply changing the plan.
Becoming the Successor Trustee
7. What is a successor trustee?
A successor trustee is the person or institution designated to take over trust management after the original trustee dies, resigns, becomes incapacitated, or otherwise stops serving.
8. What should a successor trustee do first after someone dies?
The trustee should locate and carefully review the complete trust and amendments, determine what assets are actually owned by the trust, identify beneficiaries, safeguard property, gather financial information, and determine what notices and other administrative steps are required.
9. Does a successor trustee have to accept the position?
No. A person named as successor trustee generally does not have to accept the role. If the nominated trustee declines, the trust document should be reviewed to determine who serves next.
10. Does a trustee need an attorney in Florida?
Not every administrative action requires an attorney, but trustees assume significant fiduciary responsibilities and can potentially be personally liable for improper administration.
Legal advice can be particularly valuable when the trust owns real estate or businesses, beneficiaries disagree, distributions are complicated, or the trustee is uncertain about fiduciary obligations.
11. Can two people serve as co-trustees?
Yes, if permitted by the trust. Co-trustees can provide additional oversight but may also create administrative difficulties when they disagree or cannot act efficiently together.
12. Can a beneficiary also be the trustee?
Yes. It is common for a family member who is also a beneficiary to serve as trustee. However, being both trustee and beneficiary does not eliminate the trustee's fiduciary obligations to other beneficiaries.
Florida Trustee Duties
13. What are a trustee's duties in Florida?
A Florida trustee has significant fiduciary responsibilities. These can include administering the trust in good faith according to its terms and purposes, acting loyally, dealing impartially with beneficiaries when appropriate, prudently managing assets, maintaining records, and providing required information.
14. What does fiduciary duty mean?
A fiduciary duty is a legal obligation arising from a position of trust. A trustee cannot simply treat trust property as personal property and must administer the trust for the purposes and beneficiaries established by the trust.
15. Does a trustee have to treat all beneficiaries equally?
Not necessarily equally, but the trustee must follow the trust.
Some trusts intentionally provide different rights or distributions to different beneficiaries. When multiple beneficiaries have competing interests, Florida law imposes duties concerning impartial administration consistent with the trust's terms.
16. Can a trustee use trust money for personal expenses?
Not simply because the trustee controls the account. Trust funds must be used for authorized trust purposes. Mixing personal and trust money or using trust property for unauthorized personal purposes can create serious fiduciary problems.
17. Can a trustee hire professionals?
Yes. Depending on the trust and circumstances, trustees commonly work with attorneys, accountants, financial advisors, appraisers, real estate professionals, and other professionals needed to administer trust property properly.
18. Does a trustee have to keep records?
Yes. Good recordkeeping is fundamental to proper trust administration. Trustees should maintain records of assets, income, expenses, distributions, transactions, professional fees, and other significant administration activity.
Beneficiary Rights
19. What rights does a Florida trust beneficiary have?
A beneficiary's rights depend on the trust, the beneficiary's status, and Florida law. Depending on the circumstances, rights may include receiving information about the trust, obtaining relevant portions or copies of trust documents, receiving accountings, and receiving distributions required by the trust.
20. Does a trustee have to give beneficiaries a copy of the trust?
Qualified beneficiaries may have rights to trust information and documents under Florida law. The trustee should determine who is entitled to information rather than assuming the trust can remain secret after the settlor's death.
21. Can a trustee refuse to communicate with beneficiaries?
Trustees have statutory duties concerning information and reporting. A trustee should not simply ignore beneficiaries who are legally entitled to information about the trust and its administration.
22. Can a beneficiary demand to see trust financial records?
Depending on the beneficiary's status and circumstances, a beneficiary may be entitled to financial information through a trust accounting or other required disclosures.
23. Does a beneficiary have the right to know what assets are in the trust?
Qualified beneficiaries may have rights to information concerning trust property and administration. The exact scope of disclosure depends on the trust, beneficiary's status, and applicable law.
Florida Trust Accountings
24. Does a Florida trustee have to provide an accounting?
In many circumstances, yes. Florida law imposes trust accounting obligations for certain beneficiaries unless an applicable exception or valid waiver applies.
25. What should a Florida trust accounting contain?
A proper trust accounting generally provides information concerning trust assets, liabilities, receipts, disbursements, transactions, and changes in value during the accounting period.
A trust accounting is more than simply handing beneficiaries a stack of bank statements. Read our article on Trust Accountings: Florida Trust Accounting Requirements: What Must a Trustee Disclose to Beneficiaries?
26. How often does a trustee have to provide an accounting?
The answer depends on the trust and applicable Florida law. Trustees of irrevocable trusts may have periodic accounting obligations to qualified beneficiaries, as well as obligations associated with termination or changes in trusteeship.
27. Can beneficiaries waive a trust accounting?
In certain circumstances, a beneficiary may waive accounting rights. Whether a waiver is appropriate or legally effective should be considered carefully, particularly when substantial assets or unresolved questions exist.
28. What if a trustee refuses to provide a required accounting?
A beneficiary may potentially seek court intervention to compel an accounting or other information. Continued refusal can also become relevant in a broader claim concerning the trustee's administration.
Trust Assets and Property
29. How does a trustee find all of the trust assets?
The trustee may need to review deeds, bank and brokerage statements, tax returns, business records, insurance information, prior financial records, and other documents.
One of the first important questions is not simply what the settlor owned—but what was actually titled in the trust.
30. What happens if an asset was never transferred into the trust?
An asset that was intended for the trust but remained individually owned may require probate or another procedure before it can be administered or transferred.
This is why proper trust funding during the settlor's lifetime is so important. For instructions on funding read: How Do You Fund Your Revocable Living Trust?
31. Can a trust own a house after the settlor dies?
Yes. Trust-owned real estate can remain in the trust after death while the trustee administers the property according to the trust.
32. Can a trustee sell a house owned by the trust?
Often, yes, if the trust and applicable law authorize the sale. Whether selling is appropriate depends on the trust instructions, beneficiary interests, expenses, market conditions, and purpose of administration.
33. Can a beneficiary live in a house owned by the trust?
Potentially. The trust document and circumstances should be reviewed. Occupancy can raise issues involving rent, expenses, maintenance, insurance, taxes, and fairness to other beneficiaries.
34. Who pays the mortgage, taxes, insurance, and HOA expenses on trust property?
When the trust owns property, legitimate expenses associated with maintaining and preserving that property may generally be paid from appropriate trust funds, subject to the trust and applicable law.
35. What happens to an LLC owned by a trust?
The trustee may become responsible for administering the trust's ownership interest in the LLC. The operating agreement, trust terms, business structure, and succession provisions should all be reviewed before the trustee acts.
Trust Debts, Expenses and Taxes
36. Does a trustee have to pay the deceased person's debts?
A trustee should not simply begin paying every bill that arrives.
Florida has specific rules governing claims and the potential liability of revocable trust assets for certain expenses and obligations following the settlor's death. Trust administration should be coordinated with any probate proceeding and creditor process.
37. Can trust money be used to pay funeral expenses?
Potentially, depending on the trust, estate, available assets, and circumstances. The trustee should coordinate payments with the overall estate administration rather than paying expenses without determining the proper source and priority.
38. Does a trust need a new tax identification number after death?
Frequently, an irrevocable trust created as the result of a settlor's death will require an Employer Identification Number rather than continuing to operate under the deceased settlor's Social Security number. Tax treatment depends on the particular trust.
39. Does a trust have to file an income tax return?
A trust may have federal tax filing obligations after death depending on its income and tax classification. Trustees should work with an accountant or tax professional regarding applicable federal and state tax requirements.
Trustee Compensation and Expenses
40. Does a Florida trustee get paid?
Yes. A trustee may generally be entitled to reasonable compensation unless the trust provides otherwise or another applicable rule changes the result. Read more on Trustee Compensation here: Trustee Compensation in Florida: How Much Can a Trustee Be Paid?
41. How much can a Florida trustee charge?
Unlike simply applying a universal percentage to every trust, trustee compensation should be evaluated based on the trust terms, applicable Florida law, services performed, complexity, responsibilities, and other relevant circumstances.
42. Can a trustee reimburse themselves for expenses?
A trustee may generally be reimbursed for appropriate expenses properly incurred in administering the trust. Detailed records and receipts should be maintained.
Trust Distributions
43. How long does a trustee have to distribute assets in Florida?
Florida does not impose one universal deadline requiring every trust to be completely distributed within a particular number of days after death.
A trustee generally needs reasonable time to identify assets, determine liabilities, address expenses and taxes, resolve property issues, complete accountings, and satisfy other administrative obligations before final distribution. For more details read: How Long Does a Trustee Have to Distribute Trust Assets in Florida?
44. Can a trustee make partial distributions?
Yes, partial or interim distributions may be appropriate when the trustee can safely distribute part of the trust while retaining sufficient assets for expenses, taxes, claims, and remaining administration.
45. Can a trustee hold back money from a beneficiary?
Sometimes.
A trustee may have legitimate reasons to maintain reserves for taxes, expenses, claims, litigation, property costs, or other obligations. The trust itself may also authorize assets to remain in continuing trust rather than being distributed outright.
A trustee should not withhold money indefinitely for arbitrary or personal reasons. For more information read our article: Can a Trustee Withhold Money From a Beneficiary in Florida?
46. Can a beneficiary force the trustee to make a distribution?
It depends on what the trust requires.
If a distribution is mandatory and the trustee improperly refuses to make it, a beneficiary may have remedies. If distributions are discretionary, the analysis is different and depends heavily on the language of the trust.
Trustee Problems and Trust Litigation
47. Can a trustee be removed in Florida?
Yes. Florida courts can remove trustees under circumstances authorized by law. Removal may be appropriate in cases involving serious breach of trust, lack of cooperation among co-trustees substantially impairing administration, unfitness, unwillingness, persistent failure to administer effectively, or other circumstances recognized by Florida law.
48. What if I believe the trustee is stealing or misusing trust assets?
Act promptly.
A beneficiary may potentially seek records, an accounting, discovery, injunctive relief, recovery of property, damages or surcharge, trustee removal, or other court remedies depending on the evidence.
Preserve financial statements, communications, trust documents, and other relevant records.
49. Can beneficiaries sue a trustee?
Yes. Beneficiaries may bring claims against a trustee for breach of trust or other actionable misconduct when appropriate.
Not every disagreement constitutes a breach of fiduciary duty, however. The trust terms, trustee's authority, beneficiary's rights, and actual conduct should be evaluated before litigation is filed.
Closing a Florida Trust
50. When is Florida trust administration finished?
Trust administration can generally conclude when the trustee has completed the tasks required for the particular trust—such as collecting and managing assets, addressing appropriate expenses and tax matters, completing required accountings, resolving remaining issues, and making distributions.
Some trusts do not terminate after the settlor's death. Instead, they continue for children, spouses, beneficiaries with special needs, asset-management purposes, or other reasons established in the trust.
The trust document ultimately matters.
Need Help Administering a Florida Trust?
Being named successor trustee is often viewed as an honor. It is also a serious legal responsibility.
A trustee may suddenly find themselves responsible for real estate, investment accounts, businesses, taxes, beneficiaries, financial records, distributions, and property accumulated over someone's lifetime.
Mistakes can expose the trustee to disputes and, in some circumstances, personal liability.
At Gold Legacy Law, PLLC, I help trustees understand their responsibilities and move through the Florida trust administration process efficiently. I also advise beneficiaries who need help understanding their rights or obtaining information concerning an ongoing trust administration.
Our firm serves clients in Miami Lakes, Miami-Dade County, Broward County, Palm Beach County, and throughout Florida, including trustees and beneficiaries who live outside the state but are involved with a Florida trust.
When disagreements develop, our trust administration practice also works closely with our trust litigation practice to address contested accountings, delayed distributions, alleged fiduciary misconduct, trustee removal, and other disputes.
Contact Gold Legacy Law, PLLC to schedule a consultation regarding a Florida trust administration at 305-556-5209.