Corporate Trustees

Using a corporate trustee, such as a bank or trust company, can be a prudent choice in various estate planning and trust management scenarios. Corporate trustees are professional financial institutions with expertise in managing trusts and acting as fiduciaries. As an estate planning lawyer in Folsom, I have seen that most clients choose to use family or friends as trustees, however there are still certain situations in which a corporate trustee may be beneficial. Here are some key considerations for using a corporate trustee:

1. Professional Expertise: Corporate trustees are experienced in trust administration and have a deep understanding of trust and estate laws. They can provide valuable guidance and ensure that trusts are managed in accordance with legal requirements.
2. Impartiality: Corporate trustees are typically impartial and do not have the same emotional attachments or conflicts of interest that family members or individuals might have. This impartiality can help prevent disputes among beneficiaries.
3. Continuity: Corporate trustees offer continuity of service. They will be available to fulfill their fiduciary duties even in the event of the grantor’s incapacity or passing, ensuring that the trust’s objectives are met.
4. Financial Management: Corporate trustees have the resources and expertise to manage complex financial assets, such as investment portfolios, real estate, and business interests, on behalf of the trust beneficiaries.
5. Record-Keeping: Corporate trustees maintain meticulous records of trust transactions and financial activities, which can be valuable for beneficiaries and for tax reporting.
6. Accountability: Corporate trustees are held to high standards of accountability and are subject to regulatory oversight. This can provide peace of mind for beneficiaries that the trust is being managed prudently.
7. Professional Investment Management: Corporate trustees often have in-house investment professionals who can manage trust assets, helping to achieve the trust’s financial goals and objectives.
8. Estate Tax Planning: Corporate trustees can provide expertise in estate tax planning and help minimize tax liabilities for the trust and beneficiaries.
9. Complex Trusts: In cases where trusts are complex or involve special assets, such as family businesses or charitable foundations, corporate trustees can offer the necessary expertise.
10. Neutral Conflict Resolution: When disputes arise among beneficiaries or with third parties, corporate trustees can act as neutral mediators and help resolve conflicts.
11. Trustee Succession: Corporate trustees have procedures in place for trustee succession, ensuring that there will always be a responsible party to manage the trust.
12. Regulatory Compliance: Corporate trustees are well-versed in compliance with legal and regulatory requirements, which is particularly important in complex trusts or those involving multiple jurisdictions.
13. Trustee Fees: Corporate trustees charge fees for their services, which can vary depending on the complexity of the trust. These fees should be discussed and understood by the grantor and beneficiaries.

It’s important to note that the use of a corporate trustee may not be necessary or appropriate for all trusts. In some cases, family members or trusted individuals may serve as trustees. The choice between a corporate trustee and an individual trustee should be based on the specific needs and goals of the trust and the preferences of the grantor.

Conclusion

Before selecting a corporate trustee, it’s advisable to conduct due diligence, compare the services and fees of different corporate trustees, and ensure that the chosen institution has a strong reputation and a track record of successful trust administration. Consulting with an estate planning attorney in Folsom can also provide valuable guidance in making this decision. If you have any questions about corporate trustees, contact Thapar Law at 916-579-0605 or send us a message.