How to Change the Trustee on a Revocable Trust

Trustees play a vital role in the management and direction of revocable trusts. However, sometimes trustees need to be removed and replaced. While some trusts can be easily amended to change trustees, other circumstances may require a petition to be filed in court before a trustee can be removed from power. Here’s what you should know about how to change the trustee on a revocable trust.

Advice from a financial advisor or estate planning attorney is also highly recommended when dealing with these potentially complex matters.

What Is a Revocable Trust?

A revocable trust is an estate planning tool that allows you to place your assets into a legal structure that you can still control during your lifetime. As the grantor, you retain the ability to modify the trust, add or remove assets and change beneficiaries whenever your circumstances or wishes evolve. Because the trust is fully adjustable, it offers flexibility while helping you organize your financial life more efficiently.

Most revocable trusts name you as the initial trustee, meaning you manage the assets just as you would if they were in your own name. However, the trust also designates a successor trustee who will step in if you become incapacitated or pass away. This seamless transition of authority helps avoid probate and ensures that your financial affairs can be handled quickly and privately.

Another advantage of a revocable trust is the clarity it provides for asset distribution. Instead of leaving loved ones to navigate court procedures, the trust outlines exactly how your property should be managed and transferred. While it doesn’t offer the same level of creditor protection or tax benefits as some irrevocable trusts, it remains one of the most popular tools for those seeking control, continuity and simplicity in their estate plan.

The Role of a Trustee

The beneficiary of a trust shakes hands with the trustee.

A trustee is responsible for managing the assets in a trust according to the instructions laid out in the trust document. This includes tasks like paying bills, distributing funds to beneficiaries and keeping accurate records of all financial activity. Because a trustee acts as a fiduciary, they are legally obligated to put the trust’s interests, and the beneficiaries’ needs, ahead of their own.

In a revocable trust, the grantor often serves as the initial trustee, allowing them to maintain full control over investments, property and other trust assets. When the grantor can no longer serve, whether due to incapacity or death, a successor trustee steps in to handle the responsibilities without court intervention. This smooth transfer of authority is one of the key reasons many people use revocable trusts in their estate plans.

A trustee’s role also includes communicating with beneficiaries and ensuring that the trust’s terms are followed exactly as written. They must make prudent financial decisions, maintain transparency and keep trust assets safeguarded throughout their administration. Choosing the right trustee is essential, as their actions directly impact how effectively the trust preserves, manages and distributes your estate.

Common Legal Grounds for Removing a Trustee

Trustee removal can be a serious but sometimes necessary action. In some cases, the reason for removal may be straightforward. If the trustee has died or has become incapacitated, they’ll obviously need to be replaced. Or perhaps the trustee no longer has the time or energy to devote to their duties and asks to be replaced.

Other circumstances, however, may be more complicated. A trustee will need to be removed if they’ve violated their fiduciary duty by personally profiting from trust assets, mismanaging funds or neglecting to provide annual reports.

For example, if there is substantial proof of a trustee depleting trust funds for their personal gain, it is deemed a breach of fiduciary duty and a valid reason for removal. However, there can also be conditions and limitations that could apply, such as needing court approval and valid justification for the removal.

Ways to Remove a Trustee

A probate judge rules on a petition to remove a trustee.

The trust itself should include language detailing how and by whom a trustee can be removed. Depending on the terms of the trust agreement, a trustee can potentially be removed by the grantor of the trust, a co-trustee or a beneficiary. However, some removals, including allegations of misconduct or breach of fiduciary duty, may require a petition in probate court.

Removal by the grantor: In most cases, the grantor or creator the trust will retain the ability to remove and replace the trustee, provided the trust includes language that explicitly allows for these changes. The grantor can also revoke the trust, and in effect, remove the trustee from a position of power.
Removal by a co-trustee: If a trust has more than one person managing it, one of the trustees may remove or replace another. However, a co-trustee may have to petition the probate court to follow through on this removal.
Removal by a beneficiary: Beneficiaries can also seek to remove a trustee if the trust agreement includes a provision that allows it. This may happen if the trustee is unresponsive or hostile to beneficiaries. But like co-trustees, beneficiaries may need to go to court to get a trustee removed.

How to Petition the Court to Remove a Trustee

If the circumstances surrounding the trustee’s removal require court approval, the process usually starts by gathering evidence of the trustee’s misconduct or incapability to effectively manage the trust’s assets. This evidence can include financial records, communications with the trustee and testimony from relevant individuals. The evidence forms the basis of a petition that’s submitted to the court for consideration.

The court then schedules a hearing, where the validity of the allegations will be assessed. During this period, the trust’s operations may be stalled or placed under a temporary trustee. Outcomes may range from the removal of the trustee and the appointment of a new trustee to the petition being denied outright.

Keep in mind that this process can be lengthy and expensive. The trustee may even be entitled to use trust funds to defend themself in court. Missteps or lack of knowledge can potentially result in protracted legal disputes, mismanagement of trust assets or disregard for the grantor’s wishes. It’s paramount that all the players involved, from trustors, co-trustees to beneficiaries, familiarize themselves with the nuances of the process and the conditions that could validate a trustee’s removal.

Bottom Line

A revocable trust offers flexibility, control and a smoother transition of asset management, but it also depends on having the right trustee in place. Understanding what a trustee does, and how easily you can update that role, helps ensure your trust continues to reflect your wishes as life evolves. Whether you’re adjusting your estate plan or preparing for future needs, choosing and updating a trustee thoughtfully can help protect your assets and provide peace of mind for you and your beneficiaries.

Estate Planning Tips

A financial advisor can help you organize your assets and build an estate plan. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
If you’re considering a trust as part of your estate plan, be sure to identify the entity that best suits your needs. Here’s a comprehensive guide to help you better understand the different trust variations and when they may make the most sense.