Trust Administration Essentials: Navigating Complex Family Dynamics and Legalities

Trusts can be a highly effective estate planning tool. You can set up a trust for a wide range of different purposes—from preserving wealth to protecting assets to providing for a family member with special needs to supporting a charitable organization. In Florida, trusts must be properly administered. The right trustee is a must. Here, our Fort Lauderdale trust administration attorney provides a guide to navigating the complex family dynamics and legal nuances for trusts in Florida.

A Trustee is Responsible for Trust Administration

When you set up a trust, you need to select a trustee. As described by the Florida Bar, “the person responsible for the management of the trust assets is the trustee.” Indeed, a trustee plays an absolutely crucial role. They are responsible for making sure that all of the trust’s assets are properly protected and handled in a manner consistent with the stipulations set forth by trust documents. 

Who can act as a trustee in Florida? State law holds that almost any adult or any institution can be authorized to administer the trust. The person appointed as a trustee must be mentally competent and legally capable of managing their own affairs. Florida law allows for non-residents to serve as a trustee. It is important that the chosen trustee is willing and capable of performing the role. Sometimes, the best choice is a professional—such as an accountant or financial planner.. 

Trustees have Statutory Duties in Florida

In Florida, trustees are bound by statutory duties. These obligations are designed to help ensure the responsible management of the trust. Under Florida law (Florida Statutes § 736.0801), “the trustee shall administer the trust in good faith, in accordance with its terms and purposes and the interests of the beneficiaries.” The law emphasizes the need for transparency and accountability. 

The Essentials of Trust Administration in Florida

What are the specific duties of a trust administrator in Florida? The answer depends, in large part, on the structure of the trust. With that being said, effective trust administration requires careful attention to detail. Here are the essentials of trust administration in Florida: 

• Know the Trust Documents: In Florida, a trustee’s foremost duty is to thoroughly understand the trust documents they are administering. Every trust is different. The actual instructions—including the goal of the grantor (creator)—matter. Along with other things, this part of the process involves a detailed review of the trust’s terms, conditions, and provisions to comprehend the grantor’s intentions fully. In Florida, a trustee should familiarize themselves with any specific instructions, powers granted, and any limitations imposed within the document. Understanding the trust documents matters. By knowing the trust documents, a Florida trustee can better fulfill their responsibilities. 
• Protect and Manage Assets: A trustee should protect and manage all of the property and assets held in the trust. Indeed, an absolute essential duty of a trust administrator in Florida is to protect and manage the trust’s assets. Prudence matters. Along with other things, asset management involves protecting the trust against losses and making informed investment decisions. Notably, under Florida’s state “Prudent Investor Rule,” trustees are required to invest and manage assets as prudent investors would—with consideration to the trust’s purposes, terms, and beneficiaries’ interests. 
• Notify Beneficiaries: The beneficiaries of a trust should not be left in the dark about what is happening to the property and assets that they have an interest in. A trust administrator in Florida has a duty to proactively notify beneficiaries of all relevant information. Notably, Florida law mandates that trustees keep beneficiaries reasonably informed about the trust and its administration. Upon assuming their role, trustees must provide notice to the qualified beneficiaries—including information about the trust’s existence, the identity of the grantor, and the trustee’s contact details. Regular communication is essential. Depending on the specific situation, a trustee may be required to provide annual accounting statements. 
• Handle Debts, Bills, Taxes, and Claims: It is not uncommon for a trust to have bills. Indeed, most significant trusts have certain financial obligations. There may be taxes and creditor claims against the trust (valid or otherwise). It is the duty of the trustee in Florida to handle all financial obligations associated with the trust. Along with other things, this includes paying any outstanding debts, bills, and expenses incurred by the trust. By law in Florida, trustees must also file all necessary tax returns on behalf of the trust and ensure that any taxes owed are paid promptly to avoid penalties. Beyond that, they must address any claims against the trust by assessing their legitimacy and, if appropriate, settling them. 
• Distribute Assets as Called for By Trust: Finally, a trustee must distribute the trust assets to the beneficiaries precisely as outlined in the trust documents. A trust administrator must follow the specific terms and conditions set forth by the grantor—including any timelines, conditions, and/or special instructions for distribution. The trustee has a duty to confirm that all distributions are made in a fair, impartial manner. There should never be any unjustified favoritism. Along the same lines, estate administrators cannot allow conflicting interests to come into play. Disputes can easily arise over distributions. 

Trust administration is complex. Although a family member can serve in the role, it is best to have a top Florida trust administration attorney on your side to guide the Trustee in their duties. An attorney who has extensive experience with trust administration in Florida can help you ensure your best interests are protected. 

Consult With Our Fort Lauderdale Trust Administration Lawyer Today

At The Law Offices of Odelia Goldberg, our Florida trust administration attorney has the experience that you can rely on. Have questions about trusts? We are here as a legal resource. Get in touch with us by phone or contact us online to set up a fully confidential consultation. With an office in Fort Lauderdale, we provide trust administration representation throughout South Florida, including Broward County, Palm Beach County, Miami-Dade County, and Martin County.