THE FOLLOWING IS A TRANSCRIPT OF THIS VIDEO. FOR MORE INFORMATION, CLICK HERE

Hi, this is Keith Davidson from Albertson & Davidson.  In this video, we’re talking about trust accountings.  And we just finished a video where we talked about when you are entitled to a trust accounting and it depends on the type of beneficiary you are.  But there’s two instances where you may not be entitled to a trust accounting, no matter what type of beneficiary you are.  And the first instance is if the trust waives an accounting.

This is where you have to read through your trust document to find out if the trust document waives the trustee’s obligation to account.  Normally a trustee has an obligation to account during certain periods, like once a year, or any time there’s a change of trustee.  But if the trust document waives that accounting right or obligation, then you’re not going to be entitled to an accounting.

You can still get one, however.  If you go to court and you can show that there’s a high degree of likelihood that the trustee has breached their duties of trust, then the court can still order an accounting, even though the trust document waives it.  But the trustee doesn’t have to automatically give you an accounting.  So look at your trust document and see if it waives an accounting.

The other instance is if you, as a beneficiary, waived the right to an accounting.  You may voluntarily sign a document waiving your right to an accounting and, in that instance, the trustee does not have to account to you any longer.  You can revoke that waiver and you can do the revocation of the waiver of accounting at any time.  However, once you revoke a waiver of accounting, the trustee only has to account for actions after you did the revocation of the waiver.  They don’t have to go all the way back.

But you’re still entitled to information.  So even if you can’t get an accounting, at a minimum, you should be asking for information about your trust.  You should see the bank statements, the brokerage account statements.  If real property is sold, you should see the closing statement.  You have a right to be reasonably informed about the business of your trust and you should ask for that information in writing.  You don’t have to do anything fancy.  Just send off a letter, an email, or a fax, asking the trustee to give you the documents so you can double check that everything is running smoothly.

THE FOLLOWING IS A TRANSCRIPT OF THIS VIDEO. FOR MORE INFORMATION, CLICK HERE

Hi, this is Keith Davidson from Albertson & Davidson.  In this video, I want to talk about whether or not you, as a trust beneficiary, are entitled to an accounting.  And the answer is maybe – which is a typical lawyer answer.  But let’s go through who is and who is not, necessarily, entitled to a trust accounting.

For starters, all current beneficiaries, income and principal beneficiaries, are entitled to an accounting of the trust assets – unless, the trust actually waives that right.  But if you are a current income or principal beneficiary of a trust, you are entitled to an accounting.  If you’re a remainder beneficiary, meaning that your rights aren’t vested yet, but they’ll come into place a current beneficiary passes away.  Then you may be entitled to an accounting.  But you’re not entitled to an accounting as a matter of right.  It’ll be up to the discretion of the California Probate Court.

What you are entitled to as a remainder beneficiary is information.  So you should be able to get and you are entitled to receive any information about the trust assets, the trust administration, and anything else that deals with the business of the trust.  Now that’s different from an accounting.  An accounting is a formal document that sets out charges and credits in a very systematic way, as required by the Probate Code.  But, information can be just as good if not better.

So for example, if you receive a copy of all the bank statements or all the financial account statements, that might be just as good as an accounting because you can look at those and you can see what’s been happening with the finances of the trust.  So, just because you’re not entitled to an accounting doesn’t mean that you’re left out in the dark.  You might still be entitled to information.

There’s a big caveat here.  Everything I just talked about is for irrevocable trusts.  Those are trusts that can’t be amended or changed.  If the trust is revocable, then the trustee only owes a duty to the person who has the power to revoke it, which typically is the person who created it.  If Mom and Dad create a revocable trust and they named themselves as trustee, they don’t have an obligation to give you information while they’re alive.  But, once they pass, and the trust becomes irrevocable, which is usually what happens, now your rights come into existence and you have a right to either an accounting or information, depending on the type of beneficiary you are.