In this article, we’re answering “can a trustee remove a beneficiary from a trust?”. This is an important and often misunderstood question.
So, if this is something you’re wondering, read on for important considerations that you may want to address with your lawyer.
This article is part of our series on private banking. It includes a wide range of free articles to help you find the best banks and manage your wealth effectively.
These articles cover topics ranging from opening accounts in top banking jurisdictions around the world to unlocking private banking solutions like Lombard credit and loans.
Feel free to use the table of contents to jump ahead to the sections most relevant to you.
Table of Contents
- Can a Trustee Remove a Beneficiary From a Trust?
- Role of a Trustee
- Role of a Trust Beneficiary
- Frequently Asked Questions
- Ready to Explore Your Options?
Can a Trustee Remove a Beneficiary From a Trust?
A trustee can remove a beneficiary from a trust in certain instances. The two most important factors determining if this is possible are the type of trust and the powers given to the Trustee. In the case of a revocable trust or a family trust, this may be possible. However, it is not possible to remove the beneficiaries from an irrevocable trust.
It’s also important to note that after the grantor of a revocable trust dies, the trust normally becomes irrevocable. After the death of the grantor, the beneficiaries of the now irrevocable trust cannot be changed.
In the case of a family trust, it is common for a surviving spouse to have certain powers given to them. This can include the power to remove a beneficiary from a trust.
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Role of a Trustee
The role of the trustee depends on whether they are the grantor of the trust or the successor trustee. In the case of the grantor, their role is to act as trustee until such a time that they are either no longer capable or die. The successor trustee is then charged with carrying out the terms of the trust and distributing assets correctly to named beneficiaries.
Role of a Trust Beneficiary
The role of a trust beneficiary depends on whether they are also a successor. If so, they are responsible for carrying out the terms of the trust and ensuring that the assets are distributed to the named beneficiaries.
However, if the trust beneficiary is not named successor trustee, their role will involve receiving whatever assets are distributed to them per the terms of the trust.
Frequently Asked Questions
Below are two of the most common questions that we receive from people looking to know if a trustee can remove a beneficiary from a trust. If you have further questions you would like answered, don’t hesitate to get in touch with us directly.
Can a Trustee Disinherit a Beneficiary?
Under certain circumstances, a trustee can disinherit a beneficiary. However, as mentioned, this depends on the type of trust and the powers granted to the trustee. In the case of an irrevocable trust, a trustee often cannot disinherit a beneficiary.
How Do I Remove a Beneficiary?
To remove a beneficiary from a trust, the grantor (or trustee) has two options. The first option involves the trustee removing the beneficiary. However, this is only possible when the trust is formed and the powers granted allow for the removal of a beneficiary. Alternatively, a beneficiary can renounce all their interests in a trust as a beneficiary.
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