When creating a living trust for the purposes of avoiding probate, it’s a good idea to name someone as a successor trustee. You are the primary trustee, meaning that you have the ability to make changes to the trust, dissolve the trust, and move assets in and out of the trust.
A successor trustee, however, is the person who takes charge of all of the assets inside the trust after you pass away or after you become incapacitated and are unable to manage these things on your own. The successor trustee will step up to manage and eventually distribute the assets when you are not able to do so. Most living trusts are created to give you the power to make new decisions and changes as you see fit, but you might also pass away when there are still assets inside the trust that require management.
If a successor trustee comes in after you’ve become incapacitated, they will be responsible for spending the trust money on your behalf and managing and investing trust assets. Trustees must keep trust assets separate from their own and be extremely honest while following state law. This responsibility could stretch on for years depending on the individual situation, which is why some people might appoint a corporate entity in the position of successor trustee if there’s no one in your family with the interest or ability to step into this role.
If a successor trustee needs to step up to this role after you’ve passed away, the operation of the living trust is not designed to continue. The trustee’s job in this case is to gather, identify, and safeguard trust assets, then ensuring that they can be distributed to the people who will inherit them per the trust document.
The trustee might also need to work with the estate executor to pay final income taxes and manage any assets that were not held in the trust. Choosing the right person to serve in the role of successor trustee is important. Schedule a consultation today with a trusted estate planning lawyer to learn more- if you have questions about choosing a successor trustee in California, we can help you figure out the right fit for your situation.