There was a time when trusts were mostly used by affluent people to pass down their wealth without incurring tax obligations. Today, a trust can easily be found in an average person’s estate plan. There are several different trusts that are employed for accomplishing a number of goals and one of the most common is a family trust. Like any other trust, trustee must be appointed in a family trust to oversee that trust is properly administered. Sometimes circumstances arise where the creator of the trust or the beneficiaries want to take the trustee out of the trust. You might wonder whether the trustee can be removed or not. Well, under some circumstances, the trustee can be taken out. Let’s dive deeper into the discussion to clear the air.
Family TrustA family trust may be set up with the help of an estate planning attorney. In this trust, a trustee is responsible for managing the assets. The trust is created by a grantor or trustor. Legal document is required to create family trust. In this document, an initial trustee is designated along with two co-trustees. More than two co-trustees can also be designated.
How a Grantor can Take Out the TrusteeTrust agreements generally provide the conditions or events under which the grantor may be allowed to take the trustee out of the trust. This agreement also provides the authority of removing a trustee to grantor. The grantor can remove the trustee whenever they want and they don’t have to give any reason to the trustee for removing them.
Filing a Petition at the Court
A petition for a trustee’s removal can be filed with the assistance of an estate planning lawyer. Sufficient evidence must be provided to proof that the terms were violated by trustee or they violated their assigned duty. Court will take some time to determine whether there is enough evidence to remove trustee or not and the process will be quite complex. You should discuss everything with your estate planning lawyer before you decide to file a petition at the court.
We hope you now clearly understand how a trustee can be removed from a family trust. If you are the grantor, you should have no problem taking the trustee out. If you are beneficiary or a co-trustee, you should discuss the situation with your estate planning lawyer as they will be able to guide you on how to remove the trustee.