As Successor Trustee, Do's and Don'ts re opening a checking account

My dad passed away and had a living trust. He named me successor trustee. As successor trustee, what are the do's and don'ts of opening a checking account? Is there anything special I need to tell the banker to do or not to do? It is better to just be the trustee of the checking account or the owner of the checking account, and why? I will use the checking account to deposit any proceeds from the sale of his home, pay any taxes due, pay creditors, beneficaries, etc.

Oakland, CA -

Attorney Answers (3)

Eliz C A Johnson

Eliz C A Johnson

Estate Planning Attorney - Danville, CA
Answered

You are not the owner of the account. The Trust is so you will have an account that lists your name as Trustee for the XYZ Trust. All income and expenses then run through this account and disbursements as set out in the Trust are made from this point. Do not put it in your name only or you will face serious obstacles and potential claims of mismanagement. Checks will not be made payable to you, but to the trust. It might help you to talk to a probate attorney in Alameda County.

I am not sure your posting done three times does have enough information to do much. If you had POA, it died with your mother so that power is gone. If you set up the reverse mortgage under it, you would have the documents. Since she had no will, there will need to be a probate of the assets. I don't know why the lender is appraising the asset at this point anyway. You should run not walk to a probate attorney in Idaho for help right away before you lose this asset.


Use the AVVO.com web site to find an attorney in your area. In addition to that, contact your local bar association for referral to an attorney who specializes in this or talk to friends and neighbors to ask about an attorney they have used and liked. Often, but not always, the attorney will do an initial consultation free of charge. You will then be in a better position to determine what to do next. Best of luck to you!

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Michael Robert Weinstein

Michael Robert Weinstein

Estate Planning Attorney - Santa Ana, CA
Answered

Ms. Johnson's answer is "right on the money." As trustee of the trust you are a fiduciary and must manage the assets of the trust with utmost transparency and accountability. You cannot commingle your assets with those of the trust; for example, putting the trust money in your own bank account under your name. A trust account title as "you" as trustee of the trust. Failing to set up the account properly, an interested party could have you removed as trustee or you could be subject to civil penalties.
I always tell my client's to "document, document, document." If you pay the legitimate expenses of the trust or receive deposits, always have receipts and bank statements. If the trust requires you to make distributions, you must have receipts from the recipients. You should file an accounting with the court to protect you from future actions by other beneficiaries because it sets a limit of the time other beneficiaries may challenge your actions.
A trustee should not act alone. YOu must have an attorney if you are to appear in court. You should have an attorney read the trust and guide you in your actions.
Read Ms. Johnson's advice again. It is a good starting point.

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G Logan Elliott

G Logan Elliott

Estate Planning Attorney - Sarasota, FL
Answered

Its best to open a trust account; the bank will be very familiar with this process and guide you through it step-by-step. Before you go to the bank, be sure to read the trust agreement. More than likely, the agreement will tell you exactly how to title the account.

In reality, you aren't actually the "owner" or "trustee" of the account. The account actually belongs to the trust. As trustee, you enjoy what is called legal title. Basically, that means that you can control the assets on behalf of the holders of the equitable title. These individuals are more commonly referred to as beneficiaries; they receive the benefit of the asset without any of the control.

An important point to keep in mind when working with trust assets, and the heart of your question, is to keep trust assets segregated from your own assets. That means that you must never comingle trust assets with your own which is why it is so important to insure that you have titled the trust asset properly.

Good luck!

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