Can I Be The Trustee Of My Own Trust in Massachusetts?
As estate planning attorneys serving Gloucester, Rockport, Manchester by the Sea, Beverly, and throughout the North Shore, we often hear clients ask whether they can serve as the trustee of their own trust. The short answer is yes—in most cases, you can be your own trustee in Massachusetts, but it is important to understand exactly what that role means, what your legal duties are, and when serving as your own trustee makes sense.
A trust is a legal arrangement that separates legal ownership from beneficial enjoyment. The trustee is the person or institution responsible for managing the trust’s assets, following the terms of the trust document, and acting in the best interests of the beneficiaries. When you create a revocable living trust in Massachusetts, you can usually serve as both the grantor (the person creating and funding the trust) and the trustee. This allows you to maintain full control of your assets during your lifetime while still setting up a structure that can avoid probate and manage your affairs if you become incapacitated.
Serving As Your Own Trustee Under Massachusetts Law
Massachusetts law does not prohibit you from acting as trustee of your own revocable trust. In fact, it is common practice. Under Massachusetts General Laws Chapter 203E (the Massachusetts Uniform Trust Code), trustees—whether they are the grantor or not—owe fiduciary duties to the beneficiaries of the trust. These duties include loyalty, prudence, impartiality, and accountability (M.G.L. c.203E, §§ 801–813).
When you serve as your own trustee during your lifetime, you essentially retain the same control over your trust assets as if they were owned outright. You can buy, sell, invest, or use the assets as you wish, provided you are following the trust’s terms. Because you are also the beneficiary of your own revocable trust during your lifetime, your duties to yourself do not create a conflict.
However, upon your incapacity or death, your successor trustee—someone you name in the trust—will step in to manage and distribute the assets according to your instructions. This is where careful drafting becomes critical to avoid disputes or confusion.
Risks And Responsibilities Of Being Your Own Trustee
While being your own trustee offers convenience and control, it also means you are responsible for all aspects of trust management. This includes:
- Keeping trust assets properly titled in the name of the trust
- Maintaining accurate records and financial statements
- Filing any required tax returns
- Following the investment standards set forth under M.G.L. c.203C (the Massachusetts Prudent Investor Act)
If you fail to carry out these duties, even unintentionally, you could create legal and tax problems for yourself or your beneficiaries. This is particularly important if you own property in other states, have complex investments, or expect your trust to hold business interests.
For irrevocable trusts, the rules are very different. If you serve as trustee of your own irrevocable trust, you may lose many of the asset protection and tax benefits the trust was intended to provide. In many cases, we advise clients to appoint an independent trustee for irrevocable trusts to preserve those benefits.
Choosing A Successor Trustee
Even if you serve as your own trustee while you are alive and well, you must choose a capable successor trustee to take over if you can no longer manage the trust. This person will have the same fiduciary duties under Massachusetts law, and their actions can have lasting impacts on your beneficiaries. Selecting someone who is responsible, organized, and trustworthy is essential.
Why Professional Legal Guidance Matters
While Massachusetts law allows you to act as your own trustee for most revocable trusts, doing so without understanding your duties and the potential consequences can lead to mistakes. Our role is to ensure your trust is structured in a way that protects your interests now and safeguards your beneficiaries in the future. We can help you weigh the pros and cons of serving as your own trustee, ensure your trust document complies with M.G.L. c.203E, and coordinate your trust with the rest of your estate plan.
Massachusetts Trust Frequently Asked Questions
Can I Be The Trustee Of My Own Revocable Trust In Massachusetts?
Yes. Most people who create revocable living trusts name themselves as the initial trustee so they can maintain control of their assets during their lifetime. Massachusetts law allows this under the Massachusetts Uniform Trust Code.
Can I Be The Trustee Of My Own Irrevocable Trust?
You can, but it is usually not recommended. Acting as trustee of your own irrevocable trust can jeopardize the trust’s asset protection and tax advantages. In most cases, appointing an independent trustee is better.
What Duties Do I Have As My Own Trustee?
You must follow the fiduciary duties outlined in M.G.L. c.203E, which include acting in good faith, avoiding conflicts of interest, keeping accurate records, and prudently managing trust investments.
Do I Have To Keep Separate Accounts For My Trust?
Yes. Trust assets should be held in accounts titled in the name of the trust. Mixing trust assets with personal accounts can cause legal and tax complications.
Who Becomes Trustee If I Can’t Manage My Trust Anymore?
Your successor trustee—named in your trust—will step in if you become incapacitated or pass away. It is important to choose someone reliable and willing to serve.
Can My Spouse And I Be Co-Trustees Of Our Trust?
Yes. Married couples often serve as co-trustees of a joint trust, which allows either spouse to act on behalf of the trust.
Will Being My Own Trustee Affect Probate Avoidance?
No. A properly funded revocable trust will still avoid probate even if you serve as trustee, provided all assets are titled in the trust’s name.
Do I Need An Attorney To Set Up A Trust If I’m My Own Trustee?
While it is not legally required, working with an attorney ensures your trust complies with Massachusetts law, avoids common pitfalls, and is fully integrated into your estate plan.
Are There Tax Implications If I Am My Own Trustee?
For a revocable trust, there are generally no separate tax filings while you are alive. For irrevocable trusts, serving as your own trustee could change the tax treatment, so professional advice is critical.
What Happens If I Don’t Name A Successor Trustee?
If you become unable to serve and no successor is named, the Probate and Family Court will appoint one, which can cause delays and add costs.
Call The Sullivan Firm P.C. For a Free Consultation
At The Sullivan Firm P.C., we help residents of Gloucester, Rockport, Manchester by the Sea, Beverly, and all across the North Shore create trusts that work exactly as intended. If you’re considering serving as your own trustee, we will guide you through the legal requirements, responsibilities, and best practices to ensure your trust is effective and enforceable.
Call The Sullivan Firm P.C. Today At 978-325-2721 For A Free Consultation. Our office is conveniently located in Gloucester, Massachusetts, and we proudly serve clients throughout Essex County. Let us help you design a trust that gives you control now and protects your loved ones later.
