You are a fiduciary
An executor (in Minnesota, the personal representative) administers a probate estate. A trustee administers a trust. Both are fiduciaries, which means the law holds you to a standard of loyalty and care toward the beneficiaries. In practice, that requires you to:
- Act solely in the interest of the beneficiaries, never your own.
- Keep estate or trust property separate from your own; never commingle funds.
- Keep complete, accurate records of everything received and paid.
- Invest prudently and diversify, unless the document directs otherwise.
- Treat beneficiaries impartially and keep them reasonably informed.
A fiduciary who falls short can be held personally liable for losses. That is a reason to be careful, not a reason to decline; with organization and good advice, the role is manageable.
First steps after a death
- Locate the original will and any trust documents. Order at least ten certified death certificates.
- Secure the home, vehicles, and valuables. Keep insurance in force.
- Gather account statements, deeds, titles, tax returns, insurance policies, and a list of debts.
- Obtain a tax identification number for the estate or trust and open a separate account.
- Notify Social Security, pension administrators, banks, and insurers.
- Meet with the attorney to determine whether probate is required and which assets pass outside it.
The trustee's ongoing job
A trustee's work often continues for years. Minnesota's Trust Code requires the trustee to notify beneficiaries within 60 days of accepting the role and to provide annual reports of trust property, receipts, disbursements, and fees. The trustee decides discretionary distributions by applying the standard written into the trust, most often "health, education, maintenance, and support," and documents the reasons for each decision.
Taxes the fiduciary must handle
- Final Form 1040
- The decedent's last individual income tax return.
- Form 1041
- The estate's or trust's own income tax return, with Schedules K-1 to beneficiaries who received distributions.
- Estate tax returns
- Federal Form 706 and Minnesota Form M706 if the estate exceeds the applicable threshold. See our estate tax page.
Distributing and closing
Do not distribute assets until debts, taxes, and expenses are settled or reserved for; a fiduciary who distributes too early can be personally responsible for unpaid claims. Before final distribution, provide beneficiaries with an accounting and obtain signed receipts and releases. Then close the estate with the court or, for a trust, document the termination in the trust records.
Common questions
Can I decline to serve?
Yes. A nominated personal representative or trustee may decline before accepting, and a serving fiduciary may resign following the procedure in the document or the statute. The named successor then takes over.
Am I personally responsible for the decedent's debts?
No, unless you co-signed them. Debts are paid from estate assets. Your risk is in distributing assets before valid claims are paid, or in mishandling funds.
How long does a trustee serve?
For as long as the trust lasts, which may be until a beneficiary reaches a certain age, for a beneficiary's lifetime, or indefinitely for a dynasty trust. Many trustees find it useful to review the trust annually with counsel.
What if beneficiaries disagree with my decisions?
Follow the document, keep records, communicate in writing, and seek advice before acting on anything contested. A fiduciary who acts in good faith and with reasonable care is well protected.
This page is general information about Minnesota and federal law as it relates to executors & trustees. It is not legal advice for your situation. Laws and tax thresholds change; confirm current figures with the office before acting.