Q: Sister is abusing position as Trustee of Family Trust. Can adult brother receiving SSD be named successor Trustee?
Adult sister and brother are sole beneficiaries of Trust set up by now deceased parents.
Sister has ignored brother's requests for accounting, bank statements or fund disbursements, hasn't filed taxes since she became Trustee a few yrs ago, is allowing her children to use Trust assets (live in second family home rent free), etc. Brother has no solid proof of beginning or current balance or what she's already spent - and suspects much went for her personal gain or to benefit her children.
Brother has CP and receives SS Disability as his sole income - but lives independently, functions well mentally - manages his residence, health and personal finances, drives, helps out an elderly relative w rides and shopping.
He's rightfully concerned about what his share of Trust assets might actually still be available for his future security.
If she is removed as Trustee, is being on SS Disability a legal disqualification for him being named successor Trustee by the Courts?
A:
The brother isn't 'disqualified' from being a trustee because of his status on Social Security Disability for a physical condition, but some federal benefits (specifically SSI which it sounds like may not be involved here, but I'd want to be extra sure!) may be impacted by his status as a beneficiary of a trust.
Without examining all the facts it is impossible to say how that might play out, but this is NOT a 'DIY' situation. The brother needs to consult with a local Probate and disability lawyer if for no other reason than to determine what he should be doing before petitioning for a change of Trustee. Remember the 'advantage' of a Trust is that it 'avoids probate'. The only way to do what you're asking here is to open a probate case to challenge the administration of the Trust. This is not inexpensive, easy or likely to lead to future family harmony. Be sure you're entering into this with 'eyes open'. Get local legal advice and representation!
Brent T. Geers and Trent Harris agree with this answer
A:
In Michigan, as in many jurisdictions, the following general principles apply:
Qualification as Trustee: An adult, regardless of whether they're receiving Social Security Disability (SSD) benefits, can generally serve as a trustee unless there's a specific legal reason they're disqualified. Receiving SSD doesn't automatically disqualify someone.
Trust Document: The trust instrument might have specific requirements or restrictions about who can serve as a successor trustee. Review the document closely.
Removing a Trustee: If a trustee is abusing their position, beneficiaries or co-trustees might be able to petition the court for the trustee's removal. The grounds for removal typically include breach of trust, incompetence, or a substantial change of circumstances.
Legal Implications: Before appointing someone receiving SSD as a trustee, consider potential impacts on their benefits or tax situation. This appointment might affect the amount they receive or their eligibility.
Legal Counsel: Given the complexities and potential legal implications, it's essential to consult with an estate or trust attorney to guide the process and provide specific advice.
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