Cortland, OH asked in Probate for California

Q: Marital Trust. How long after Trustee provides accounting to executor can Income Beneficiary's estate sue?

Trustee is sole remainder beneficiary.

Did our own accounting year by year using Trustee's accounting and the tax returns we could get from Trust. Trustee provided fraudulent K-1s to IRS, Beneficiary paid all the taxes of the Trust, but Trust did not pay over $400k of K-1 income (withheld it and ultimately kept it). They say we are time barred from bringing an action. Amateur accounting in 2017, some tax returns in 2018, refuses to provide any statements or evidence. Only recourse is to go to IRS regarding K-1s we just realized were never actually paid to beneficiary, and court to obtain additional income not paid by Trust.

Trustee says we are time barred. Everything I have found says we have 3 years after receipt of accounting.

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2 Lawyer Answers
Nina Whitehurst
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Answered
  • Probate Lawyer
  • Crossville, TN
  • Licensed in California

A: You should invest in a consultation with a local trust litigation attorney. It is possible that the statute of limitations was tolled during the time that the malfeasor hid the truth by providing fraudulent accountings. The statute does start to run when you discover the truth, however, so do not delay.

Bill Sweeney
Bill Sweeney
Answered
  • Probate Lawyer
  • San Juan Capistrano, CA
  • Licensed in California

A: You indicated that the Trustee is the sole remainder beneficiary. Your information is not clear on who was injured financially and in what way. I agree with Ms. Whitehurst that if you believe you have a claim against the trustee you should retain competent counsel to review your claim and whether you have standing to assert a claim. That counsel can review the circumstances, including the tolling of any applicable statute of limitations.

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