MAKE SURE YOUR TRUSTEES CAN NAME A CO-TRUSTEE OR THEIR SUCCESSOR TRUSTEE
Thursday, August 4th, 2011
It is important to make your estate planning documents flexible. As best as possible, we try to foresee the future and address the planning possibilities. We know it is not possible to address everything now for a trust that could be in place 10, 20, 50 or 100 years from now. So we give the succeeding generations the power and authority to adapt and deal with the future circumstances. We want the tax and creditor, divorce and asset protection enhancements and benefits provided by trusts, but we do not want the trusts to become an inadvertent burden on the beneficiaries.
Two powers providing needed flexibility to a Trustee are the authorities to name either a co-trustee to act with him/her or to name his or her successor. The ability to name a co-trustee may be valuable where the named trustee is in unexpected need of professional assistance because of complexities dealing with the trust assets, the legal requirements of the trust, or in dealing with the trust beneficiaries.
The named trustee may want to stay involved as co-trustee, but they may also want the formal assistance of a professional trustee. Note that the named trustee is also typically given the power to remove the professional trustee if appropriate or necessary.
Secondly, the trustee power to name his/her successor is invaluable. Again, we do not know how long a trust will continue or if a trust will benefit succeeding generations. Therefore, we do not know that the named trustee or trustees will have the longevity or continued willingness to act. Giving the trustees the power to name a successor will help to prevent a situation where no trustee is available to act.
Take care to grant these and other powers to your trustees. You cannot predict the future so let the Trustees deal properly with the events they face in the future. If you would like to update your documents, where possible, or would like to review these and many other planning nuances that can help accommodate the future needs of your trustees and beneficiaries, please call or contact Douglas L. Kaune at 610 933 8069 or dkaune@utbf.com.
Douglas is a partner with Unruh, Turner, Burke & Frees, P.C. serving clients in Paoli, Collegeville, Royersford, Berwyn, Wayne, Pottstown, Norristown and all other towns surrounding the Firm’s three convenient office locations in Phoenixville, Malvern and West Chester.
