Being named as a trustee is an honor — and a significant legal responsibility. Whether you are managing a trust for an incapacitated loved one or settling one after a death, your duties are defined by Florida law and you can be held personally accountable if you fail to carry them out properly.
What are the main duties of a trustee in Florida?
At its core, the trustee's job is to manage the trust's assets prudently and in the best interests of the beneficiaries — not their own. Florida's Trust Code (Chapter 736, Florida Statutes) imposes several fundamental duties:
- Duty of loyalty — The trustee must act solely in the interests of beneficiaries, avoiding conflicts of interest.
- Duty of prudence — Assets must be managed as a prudent investor would, with care, skill, and appropriate diversification.
- Duty to inform and account — Beneficiaries must be kept informed about the trust and provided with regular accountings.
- Duty of impartiality — When a trust has multiple beneficiaries, the trustee must balance their competing interests fairly.
- Duty to keep records — Accurate, organized records of all trust activity are non-negotiable.
What does a trustee do when the grantor is incapacitated?
A revocable living trust can spring into action during a grantor's lifetime if that person becomes unable to manage their own affairs. When the successor trustee steps forward, their responsibilities include:
- Overseeing the care and personal needs of the incapacitated person
- Reviewing health insurance, Medicare, and any long-term care benefits
- Applying for applicable disability benefits
- Assembling a team of advisors — attorney, CPA, financial advisor
- Notifying financial institutions of the change in trustee status
- Keeping meticulous records of all income, expenses, and decisions made
What is the difference between a trustee's duties during incapacity vs. after death?
After the grantor dies, the trust becomes irrevocable and the trustee's role shifts to estate settlement. Post-death duties include:
- Consulting an attorney to review the trust document and understand your obligations
- Notifying all beneficiaries of the grantor's death (Florida law requires this)
- Inventorying all trust assets and determining their fair market values
- Filing required tax returns — the grantor's final income tax return, and potentially a trust income tax return
- Paying valid debts and expenses from trust assets
- Preparing a final accounting and distributing assets as the trust directs
Can a trustee be removed in Florida?
Yes. Under Florida Statute § 736.0706, a trustee can be removed by the court for serious breach of trust, persistent failure to perform duties, unfitness or unwillingness to administer the trust effectively, or substantial deterioration of the trustee-beneficiary relationship.
A trustee can also voluntarily resign, but not without proper notice and, in many cases, court approval or beneficiary consent. Walking away without following the proper process can expose you to liability.
If you have been named as a trustee and want to understand what is expected of you — or if you are a beneficiary concerned about how a trust is being administered — Lauren Richardson Law can help.