You have agreed to be the Trustee of your parents’ Trust. You have also read up on what this new role requires and how to act appropriately on whatever steps must be taken once you are officially overseeing the Trust. Congratulations—your parents clearly chose the right person for the job, and we are sure you will do a fantastic job. 

Of course, the next question is: What exactly needs to happen for you to step in legally? Is it as simple as your parents’ unfortunate death or incapacitation? This is a common question from first-time Trustees, and the quick answer is not quite.

Let us break this down so you can move forward with confidence when the time comes.

4 Ways a Trustee Can Take Over a Trust

1. The Trustor voluntarily resigns — If one or both of your parents are legally competent, that is, capable of making and agreeing to a voluntary resignation, you may proceed to act as Trustee once the Trustor signs an appropriate Trustee resignation document and has it notarized. That said, you may need an attorney’s assistance when determining the capacity of the Trustor and formalizing the resignation document. The original Trustee resignation should be placed with the original Living Trust document, and a copy should be placed with the other document copies.
2. The Trustor signs a Living Trust Amendment — This amendment states that you are now appointed to serve as the immediate sole Trustee (or as Co-Trustee with the Trustor, if he or she wishes). An amendment has certain advantages over a resignation, in that the Trustor is affirmatively stating his or her wishes to have you act immediately, so there is less likelihood of other people questioning your authority. In addition, the Trustor is spared the emotional disappointment of acknowledging his or her inability or unwillingness to act, and the Trustor may choose to continue to act as a Co-Trustee with you until he or she feels comfortable enough to resign and let you solely handle his or her affairs. However, whether the Trustor voluntarily resigns or amends the Trust, there is still a possibility that his or her actions can be questioned based on legal capacity.
3. Letter from attending doctors — Two doctors who have worked with one or both of your parents can write a letter stating that the Trustor, in their opinion, is no longer able to handle his or her affairs (whether one letter will be sufficient and the exact wording of the doctor letters will be dictated by the language contained in the Living Trust document).
4. Refer to what the Living Trust dictates — The final way you may take over as Trustee can be dictated in the Living Trust document itself. Sometimes, the beneficiaries or a special party to the Trust (such as a “Special Co-Trustee” or “Trust Protector”) may have the authority to appoint and install you as the acting Trustee. If the Trust does not provide for this and all of the other options fail, you may need to file a petition with the Probate Court to install you as the new Trustee.

As always, you should consult with an attorney for any matters related to your loved one’s Living Trust and how you should act when the time comes for you to step in as the Trustee. Doing so creates peace of mind and ensures everything is done correctly.

Call Leigh Hilton PLLC Today!!

Having a competent attorney in your corner will help you and your family navigate the often overwhelming waters of protecting everything you own and everyone you love. That is our job, and we think we do it better than anyone else. Call Leigh Hilton PLLC so that we can help ensure you and your family are taken care of in the best way possible.

Leigh Hilton PLLC wants to be your first call every time for any estate planning need. We look forward to serving you.