One of the most important duties in a trust is serving as a trustee. With that, you are tasked with many vital fiduciary duties. You are responsible for managing the assets and keeping records of every transaction. Also, you need to clearly communicate every step with the beneficiaries. So, how to administer a trust in Wisconsin? Here is our guide to help you set yourself up for success.
Fully Understand Your Role
Sometimes, people accept the position of a trustee without fully understanding the responsibilities associated with it. You will need to dedicate yourself to the role. You will need to gather the trust assets, notify the beneficiaries, or manage the trust property. That means acting with the utmost loyalty and care. You will need to place the interests of the beneficiaries ahead of your own. Keep in mind that this is a legally binding position.
Adhere to the Trust’s Terms and Legal Obligations
After you have accepted the role of a trustee, you will need to review the trust document. This document is your rulebook. You can reference the grantor’s intentions so that you know how assets should be managed and understand the responsibilities assigned to you. You are legally bound to adhere to the trust’s terms.
Also, you will want to familiarize yourself with the Wisconsin Trust Code. Many times, it is very beneficial to reach out to a trust law attorney who can ensure that you are meeting all applicable regulations and legal requirements in the state.
Communicating with Beneficiaries
Your role does not exist in a vacuum. One of the primary responsibilities is to keep the beneficiaries updated on the process. Once the trust is enacted, you must notify the beneficiaries and any other interested parties of its existence. You will need to provide them with a copy of the trust document. Under Wisconsin law, you will need to keep beneficiaries reasonably informed about the administration of the trust, including its financial condition.
Managing Trust Assets
As part of your fiduciary duty, you need to manage the trust’s assets in the best interest of the beneficiaries. Under Wisconsin law, all trustees must follow the “Prudent Investor Rule.” That requires them to invest and manage the assets with care, skill, and caution, considering the needs of the beneficiaries and the trust’s purposes. However, it is more than an investment. You will need to pay property taxes, maintain real estate, and ensure the trust remains financially stable.
Pay Taxes and Debts
You will be responsible for ensuring that any required federal and Wisconsin state taxes are filed and paid on time. Many times, the trust may have its own tax identification number. If the trust earned an income, that may be subject to income tax.
Along with that, the trustee must make sure that any outstanding debts or liabilities of the trust are paid. These can include expenses related to property maintenance, legal fees, or debts owed by the grantor before their passing. These obligations must be met before you can distribute assets to the beneficiaries.
Distribute Trust Assets
Once all debts, expenses, and taxes are paid, then the distribution process to the beneficiaries can begin. Often, the trust document will outline how and when these transfers should occur. In some cases, assets may be distributed all at once. However, sometimes, these distributions may be staggered over time. You will have to follow the instructions provided in the trust document.
Closing the Trust
Unfortunately, disputes can arise. As the trustee, you will need help resolving them. If issues occur, Wisconsin law has several solutions, such as mediation or litigation.
Once all assets have been distributed, you can start the process to close the trust. In many cases, you will need to file a final report, which will essentially release you from your trustee duties and close the trust.
Find the Help You Need with Your Trust Administration
Now that you know how to administer a trust in Wisconsin, get the legal help you need to be successful in your role. If you have any questions about trust administration, contact the Collins Law Firm. We offer comprehensive estate planning, administration, business, and elder law services. We proudly serve Southeastern Wisconsin and the Milwaukee area.
Our experienced estate planning team helps individuals like you to build and protect your legacy. Schedule your free and confidential consultation today by contacting us or calling (414) 207-6292.