In Oregon, trusts are a major component of many estate plans. The successor trustee performs an essential role in an estate, but what is a successor trustee in Oregon?
What is a successor trustee in Oregon?
In Oregon, there is the person who created the trust, known as the grantor. When the person passes away or becomes incapacitated, the successor trustee takes up the duties of managing, administering, and executing the trust.
In essence, a successor trustee is the person or institution in charge of making sure the terms of the trust are fulfilled. The specifics may vary depending on the terms of any given specific trust.
Fulfilling a trust may also be a long-term duty and responsibility, especially when the trust’s beneficiaries are minor children.
The Oregon State Bar explains it like this:
“the trust identifies who will take over as trustee, and directs the successor trustee how to manage trust assets… the trust directs the successor trustee how to distribute remaining trust assets after the settlor dies.”
Who can be a successor trustee?
A Declaration of Trust is the document where the trust’s grantor names a successor trustee. Common choices for a successor trustee include:
- A financial institution
- Family friend
- Estate planning attorney
- Tax professional
- Relative
- Financial advisor
Technically, Oregon law allows for any competent adult or designated institution to serve as a successor trustee. A grantor can also name multiple trustees, perhaps with different duties per trustee.
Courts do not supervise the successor trustee. Therefore, it’s essential that the grantor designate one or more trusted, reliable individuals and/or institutions.
This is also a voluntary role. If someone is informed that they were chosen as a successor trustee in an Oregon trust, that person is free to decline the role.
What does a successor trustee do, and what responsibilities do they have in an Oregon trust and estate?
When the baton passes from the grantor to the successor trustee, that successor trustee now takes on the responsibility of administering, managing, and fulfilling the trust. Most trust duties are of a personal or financial nature, such as:
Personal duties of a successor trustee in Oregon
- Perform notifications of all organizations and people declared as beneficiaries under the terms of the trust
- Maintain regular and timely communication with beneficiaries and other relevant parties
- Order death certificate copies (the funeral home can also help with this process)
- Distribute or liquidate estate property that is not directly addressed in the trust
- Execute the terms of the trust that determine how trust property and assets are to be distributed, and/or managed on an ongoing or limited basis
- File taxes for the deceased (eg, federal and Oregon taxes)
Financials duties of a successor trustee in Oregon
- Review and understand all trust documents
- For estate assets that need to pass through probate, coordinate with relevant parties
- Access trust bank accounts (or create bank accounts in the name of the trust as needed)
- Maintain accurate accounting
- Inform debtors, financial institutions, and other financial parties of the trust
- Inventory all financial assets relevant to the trust, such as bank/investment accounts, debts, assets, and account numbers
- Secure all trust property and arrange appraisal
- Maintain any financial obligations, such as utility bills for real property
- Report grantor death to credit bureaus
- Cancel financial or personal accounts, such as subscriptions and credit cars
- Distribute property to beneficiaries under the terms of the trust
When the terms of the trust have been fulfilled, it is also the successor trustee’s responsibility to close the trust.
What else does someone need to know about being a successor trustee in Oregon?
Many parties can come into play for an estate, and a successor trustee fills their own role and has their own distinct duties and responsibilities.
For example, a trustee is typically appointed when the trust is first set up, during the grantor’s lifetime. A successor trustee is appointed after the grantor’s death. Beneficiaries will receive assets from the trust according to its terms. The successor trustee, however, fulfills the trust and oversees its management.
Another role can be an executor, or personal representative. Whereas a successor trustee manages the trust, an executor or PR may oversee the entire estate, including the will and probate process.
A successor trustee has an important role in faithfully managing and executing an Oregon trust
Fulfilling a trust is an important responsibility under Oregon law. When a grantor names someone a successor trustee, they pass along their desire that the terms of their trust be overseen and taken care of faithfully. The actions of the successor trustee ensure that happens, so that the trust’s beneficiaries receive what the grantor wanted them to have, and the grantor’s wishes are fulfilled.
