What are the reporting requirements of a trustee to beneficiaries of a trust?
A Trustee must keep beneficiaries reasonably informed about administration of trust and of material facts necessary to protect their interest.
Unless unreasonable, a Trustee shall promptly respond to a beneficiary’s request. What is “prompt” seems to be governed by a reasonableness standard.
Reporting requirements: ‘Upon request, a trustee shall:’
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Furnish a copy of the trust
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Notify current beneficiaries of a change in trustee’s compensation
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Send beneficiaries at least annually a report of trust property, liabilities, receipts, and disbursements, a listing of assets, and market values if feasible.
The comment states that the UTC employs the term “report” instead of “accounting,” This is in order to negate any inference that the report must be prepared in any particular format, or with a high degree of formality.
The reporting requirement might even be satisfied with copies of the trust’s income tax returns and monthly brokerage account statements — if the information on to see returns and statements is complete and sufficiently clear. The key factor is not the format chosen but whether the report provides the beneficiaries with the information necessary to protect their interests.”
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