Need help with a letter to a trust administrator
June 17, 2017 5:40 AM   Subscribe

How to document a request for a distribution when the need for funds is less than specific??

My grandmother left money in a trust to her son, my father, and then to his four children with the possibility of distributions as deemed necessary. None have been made that I know of. My father has become mentally incompetent and I have succeeded him as trustee for all of his affairs.

Until his death, this trust is also administered by a certain bank as corporate trustee. As successor trustee I recently reached out to the bank, requesting a distribution for my sister, who is under great financial duress, taking care of her grandchildren. In response, the bank sent my sister a form which requests documentation of her needs in order to provide a distribution from the trust. My sister contacted me because she does not know how to document this (other than copies of checks given to her daughter and the like). Honestly, I can see she is overwhelmed and I'd like to help her out.

Google has not provided much help. I can contact the administrator at the bank for more info, but before I do that, I thought I would ask the hive mind for advice. Has anyone been in this situation before? I"d like her to get 20k or so to help her out over the next year or so. How would she document her needs in such a vague case (help for her daughter, a single mom with two kids)? It isn't like having a specific hospital bill or tuition payment to submit? Many thanks for any help in advance.
posted by anonymous to Law & Government (5 answers total)
 
The customary recommendation to consult a lawyer applies here. If you are in fact "successor trustee" then you may have the authority to make this decision. The cost may not be very high.

I cannot help with how the documentation should be provided; she is in the best position to explain what her needs are. But it should be noted that the bank's trust department is more likely to agree to a requested distribution if you and your siblings (the other trust beneficiaries) give the bank a letter supporting the request. The corporate trustee wants to have something in writing to protect itself in the event other beneficiaries (or later beneficiaries) raise a question about why a particular distribution was made.
posted by yclipse at 5:58 AM on June 17, 2017 [1 favorite]


I have spoken to a lawyer in regards to the larger trust, not my grandmother's. Your advice is good, thank you, and I do understand the bank needs documentation. I'm just unsure how to advise my sister to do that. I suppose I can speak to the attorney representing me in the larger estate.
posted by chaoscutie at 10:18 AM on June 17, 2017


Do you know the specific language of "as deemed necessary" - my guess is that there is specific guidance for the trustee in terms what the purpose of the allowed distributions. Once you know that, you can match your sister's needs to the language of the trust. Start by looking at what her daughter spending her money on? Rent? Utilities? Child care? Car Payments? Insurance? All of these things are pretty easy to document. Then earmark your sister's money for specific expenses that can be documented - whatever your sister can take care of frees up money for other, less predictable expenses like groceries.

I also suspect that ycipse's advice is good - a letter from the other siblings supporting the expenditure might make a big difference to the bank trustee.

In any case, figure out what expenses she could document and then call the trustee and ask them if it would work.
posted by metahawk at 11:48 AM on June 17, 2017 [1 favorite]


Have a conference call with the bank trustee to see what they want. They'll probably want a tax return and a budget.
posted by jpe at 12:35 PM on June 17, 2017


Look at the terms of the trust itself and draft the request to track them.
posted by praemunire at 3:10 PM on June 17, 2017


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