What is a co-trustee & what do they do?

When more than one trustee is appointed to manage a trust, they are co-trustees.

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Elissa SuhSenior Editor & Disability Insurance ExpertElissa Suh is a disability insurance expert and a former senior editor at Policygenius, where she also covered wills, trusts, and advance planning. Her work has appeared in MarketWatch, CNBC, PBS, Inverse, The Philadelphia Inquirer, and more.

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When there are multiple trustees appointed to manage a trust, they are called co-trustees. A trustee manages and administers a trust, including selling and distributing trust property, and filing taxes for trust income when necessary. Co-trustees typically share the same duties and powers, unless the trust document instructs otherwise. 

A trust is an estate planning tool that can hold your assets and pass them to beneficiaries in the future. The person who opens the trust —  called the grantor, settlor or trustor — may choose to appoint co-trustees to share responsibilities overseeing the trust, but sometimes having multiple trustees can cause disagreements that can delay trust administration. Co-trustees usually need to come to a consensus when making decisions about the trust.

Key takeaways

  • Co-trustees must cooperate when managing trust property and overseeing trust administration

  • You can give each co-trustee specific or different duties in your trust document

What does a co-trustee do?

Trustees and co-trustees have a fiduciary duty to act in best interest of the trust beneficiaries. A trust is a separate entity that holds the trust's assets and the co-trustees are responsible for managing them according to the grantor's wishes. Depending on how complex the trust is, the co-trustees duties may not consist of much more than distributing trust assets to beneficiaries upon the grantor's death and doing a final trust accounting. 

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In other cases, such as with more complex trusts that last for years, co-trustees have more obligations, like maintaining trust property, filing and paying trust taxes with trust funds, and overseeing investments. (It's not uncommon to use a professional trustee, like a trust company, for large estates where the main objective of the trust is growing trust assets.) 

Related article: Can a trustee sell trust property?

Who can be a co-trustee?

The grantor can choose almost anyone except a minor to be co-trustee. If you’re the grantor and trustee of your revocable living trust, you may also appoint someone to serve as co-trustee with you. For example, you and your spouse could be co-trustees of your family trust or joint trust. You could also name your daughter as successor trustee to take over once you pass away. She would act as co-trustee with your surviving spouse.

You can open a revocable living trust with Policygenius using attorney-approved tools. 

Can a co-trustee act alone?

Co-trustees must be in agreement (either unanimously or by the majority) when making decisions unless the trust agreement expressly allows one co-trustee to act independently. For example, the trust agreement may only allow a co-trustee to serve only in limited roles or circumstances, like when the other co-trustee is unavailable.

If co-trustees have disagreements, they can take one another to court and file a written objection, and even ask the court for instruction if they cannot come to a decision. A co-trustee can also try to remove another co-trustee with help from the grantor or the trust beneficiaries, who have the right to petition the court for trustee removal. (Beneficiaries can go one step farther and sue a co-trustee for losses that result from their mishandling of trust administration.) 

It’s important to be clear with your intentions in your trust document so your co-trustees don’t have to guess. Squabbling and disagreements will lengthen the time it takes the beneficiary to their inheritance.

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