Successor trustee duties: a step-by-step guide
When the person who made a living trust dies, the successor trustee takes over, usually without going to court. Here is what the job involves, in order: the notices, the tax steps, the records, and the rules that protect you and the beneficiaries.
Key facts
- A successor trustee manages a living trust when the person who made it dies or can no longer manage their affairs, following the trust’s instructions.
- There is no court appointment: the trust document and a death certificate give you authority over the trust’s property.
- At death, a revocable trust becomes irrevocable and needs its own tax ID number.
- Many states require notice to the beneficiaries within 60 days, including California and many states that follow the Uniform Trust Code.
- Trustees must act in the beneficiaries’ interest, treat them impartially, invest prudently and keep trust money separate from their own.
What a successor trustee does
A living trust names a successor trustee to take over when the person who made it, the grantor, dies or can no longer manage their affairs. The successor trustee steps into the grantor’s shoes for the trust’s property: managing it, paying bills and, after a death, distributing it to the beneficiaries as the trust directs.
Unlike an executor, a successor trustee does not need a court appointment. The trust document, a death certificate and, for banks, a short certification of trust are usually enough. Only property held in the trust passes this way. Anything left in the grantor’s own name may need probate, usually through the pour-over will and an executor. Often the same person handles both.
Step by step after a death
- Get death certificates. Nolo suggests ordering 8 to 12 certified copies. Each bank and brokerage firm will want one.
- Read the trust. Find the original trust document and every amendment. Note who the beneficiaries are, what each receives and when, and any instructions about specific items, trusts that continue for children, or your own pay.
- Notify the beneficiaries. Write to each beneficiary that the trust is now irrevocable and that you are in charge. Many states set a deadline and a required content; see below.
- Get a tax ID and open a trust account. Once the trust is irrevocable it needs its own employer identification number (EIN) from the IRS, which is free online. Open a bank account in the trust’s name for all receipts and payments.
- Take inventory. List the trust’s assets and the grantor’s debts, and get values as of the date of death: appraisals for real estate, statements for accounts. Those values set the heirs’ tax basis.
- Take control of the assets. Show banks and brokers a certification of trust and the death certificate, and retitle accounts to yourself as successor trustee. Keep property insured and maintained.
- Pay bills, debts and expenses from trust funds, including the funeral, final medical bills and the costs of running the trust. Keep every receipt.
- Handle the tax returns: the grantor’s final income tax return, the trust’s own returns and, for large estates, the estate tax return.
- Keep beneficiaries informed and give them an account of what came in and what went out.
- Distribute the property as the trust directs, outright or into trusts that continue for young or vulnerable beneficiaries, and send each beneficiary a final statement.
Notifying beneficiaries
Most states require the trustee to tell beneficiaries about the trust, and some set strict rules for the notice.
| California | States that follow the Uniform Trust Code | |
|---|---|---|
| Deadline | 60 days after the trust becomes irrevocable | Often 60 days after you accept the role, and 60 days after you learn the trust has become irrevocable; some states say “within a reasonable time” |
| Who gets notice | Every beneficiary and every heir of the grantor | Qualified beneficiaries: generally those who can receive distributions now or are next in line |
| What it must say | Who made the trust and when, each trustee’s contact details, where the trust is administered, the right to a copy of the trust, and a warning about the deadline to contest it | That the trust exists, who made it, your contact details, and the right to a copy of the trust and to trustee reports |
| Deadline it starts | A beneficiary or heir has 120 days after the notice, or 60 days after receiving a copy of the trust within that time, whichever is later, to contest the trust | Varies by state |
Even where the law is looser, early and regular updates prevent most disputes. Beneficiaries who know what is happening, and why it takes time, rarely go to court.
Taxes
- New EIN. The IRS requires a new number once a revocable trust becomes irrevocable.
- The grantor’s final Form 1040 for the year of death. If no executor has been appointed, this usually falls to you.
- Form 1041 for the trust, in any year it has taxable income, gross income of $600 or more, or a beneficiary who is a nonresident alien.
- The section 645 election. With IRS Form 8855, the trustee, together with the executor if there is one, can elect to treat the trust as part of the estate for income tax, so one return covers both. The election must be made by the due date, including extensions, of the first Form 1041. It cannot be revoked, and it lasts up to two years after the death when no estate tax return is required.
- Form 706, the federal estate tax return, if the estate is above $15 million for deaths in 2026, or if a surviving spouse wants to keep the unused exemption. Trust property counts toward the estate. See estate tax in 2026.
- Stepped-up basis. Property in a revocable trust generally takes a new basis equal to its value at death, so record those values carefully. Heirs will need them when they sell.
Your duties as trustee
Under the Uniform Trust Code, which many states follow, a trustee owes these duties:
- Loyalty: run the trust solely in the beneficiaries’ interests. Deals between the trust and yourself can be undone.
- Impartiality: with two or more beneficiaries, treat them fairly in investing, managing and distributing.
- Prudence: use reasonable care, skill and caution.
- Prudent investing: look at the portfolio as a whole, weigh risk and return, inflation, taxes and the need for cash, and diversify unless there is a good reason not to.
- Separate property and good records: keep trust property apart from your own, and keep adequate records of everything you do.
- Information and reports: keep beneficiaries reasonably informed, and report at least once a year and when the trust ends, showing the assets, debts, receipts, payments and your pay. California requires an account at least once a year, when the trust ends and when the trustee changes.
Pay and personal liability
If the trust sets your pay, you are entitled to that amount, although a court can adjust it if your duties turn out very different from what was expected, or if that amount is unreasonably low or high. If the trust says nothing, you are entitled to compensation that is reasonable under the circumstances. Many family trustees who are also beneficiaries waive it. Either way, the trust reimburses proper expenses.
A trustee who breaches these duties can be ordered to restore the trust to where it would have been, or to give up any profit made from the breach, whichever is greater. Acting in good faith, keeping records and getting professional help with taxes and investments are your best protection, and a trustee can normally pay a lawyer or accountant from trust funds for help running the trust.
How long it takes
For a simple trust, Nolo says most of the work is usually done within about six months, and no court filings are needed to wind it up. Policygenius notes settling a trust can take as long as 18 months. The usual causes of delay are selling a house, waiting for tax returns to be settled, disagreements among beneficiaries, and assets that have to be found or valued. Trusts that continue for young beneficiaries can last for years by design.
If the grantor is alive but incapacitated
If the grantor can no longer manage their affairs, you take over under the conditions the trust sets, often a written statement from one or more doctors. The trust stays revocable, your duties run to the grantor, and you use the trust property for their care. You have no authority over property outside the trust, such as retirement accounts or tax filings; that takes a durable power of attorney.
Planning your own trust?
Six questions show whether a living trust is worth it for your family, and what to do next.
Take the quizFAQ
Does a successor trustee have to go to court?
Usually not. The point of a living trust is to pass property without probate. A court gets involved only if someone challenges the trust or the trustee, or if the trustee asks a judge for instructions.
Can the successor trustee also be a beneficiary?
Yes, and it is common, for example an adult child who inherits a share. You still owe the other beneficiaries loyalty and impartiality.
How do I prove to a bank that I am the trustee?
Give the bank a certification of trust, a short signed statement of the trust’s key facts such as its date, the trustees and their powers, along with a death certificate. In California and in states that follow the Uniform Trust Code, a bank can rely on the certification instead of reading the whole trust, and is protected when it does so in good faith.
Can a successor trustee sell the trust’s house?
Usually yes. Most trusts give the trustee power to sell without court approval. The sale has to serve the beneficiaries, at a fair price, and buying the property yourself is a conflict of interest that the trust, the beneficiaries or a court would need to approve.
Can I refuse to be the successor trustee?
Yes. You do not have to accept. The trust usually names a backup, and if there is none, the beneficiaries can often agree on one or ask a court to appoint one. Once you have accepted, you can usually resign by giving the notice the trust or state law requires.
Do beneficiaries have a right to see the trust?
Generally yes, once the trust is irrevocable. In California, the trustee’s notice must tell beneficiaries and heirs they can request a copy of the trust’s terms, and the Uniform Trust Code gives any beneficiary who asks the same right.
Sources
- Nolo: The trustee’s job, the first six months
- Policygenius: Settling a revocable trust after the grantor dies
- Uniform Trust Code §813 as enacted in Maine (duty to inform and report)
- Uniform Trust Code as enacted in Maine: §802 (loyalty), §803 (impartiality), §804 (prudent administration), §810 (records), §708 (compensation), §1002 (damages for breach) and §1013 (certification of trust)
- Uniform Prudent Investor Act as enacted in Maine: §902 and §903
- West Virginia Code §44D-8-813
- California Probate Code §16061.7 (notice by trustee), §16061.8 (contest deadline), §16062 (accounts) and §18100.5 (certification of trust)
- IRS: Do you need a new EIN?
- IRS: Instructions for Form 1041
- IRS: About Form 8855, election to treat a qualified revocable trust as part of an estate
- IRS Publication 551: Basis of assets and 26 U.S. Code §1014 (basis of property acquired from a decedent)
- IRS Publication 559: Survivors, executors, and administrators
OakTrust.com provides general information, not legal or tax advice. Trust law, notice rules and deadlines vary by state, and the trust document itself may change your duties. For advice on a trust you are handling, talk to an attorney licensed in the state where it is administered.