You’re the Successor Trustee. The Good News? No Probate Court. The Bad News? You Still Have a Job to Do.

The trust was supposed to make things easier. And it does—no court supervision, no public filings, no waiting for a judge’s approval. But “no court” doesn’t mean “no rules.” As successor trustee, you have legal duties, potential liability, and beneficiaries expecting answers. At Boroja, Bernier & Associates, we help Michigan trustees administer trusts correctly, efficiently, and without the mistakes that create problems down the road.

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Trust Administration: All the Responsibility, None of the Court Oversight

Here’s what most successor trustees don’t realize until they’re in it: a trust doesn’t administer itself.

Yes, trusts avoid probate. Yes, they’re private. Yes, there’s no judge looking over your shoulder. But that’s not a vacation from responsibility—it’s more responsibility, not less. Without court oversight, there’s no one catching your mistakes. No judge asking clarifying questions. No procedural guardrails forcing you to do things right.

You’re it.

The Michigan Trust Code (MCL 700.7101 et seq.) spells out what trustees owe beneficiaries. Fiduciary duties. Notice requirements. Investment standards. Accounting obligations. Distribution rules. It’s a real job with real legal standards—and real liability if you breach them.

The irony? Trusts are designed to make estate administration easier. And they do—when administered correctly. But a trustee who doesn’t understand the rules, ignores beneficiary rights, or plays fast and loose with trust assets can turn a streamlined process into a legal disaster.

Quotable Expert Statement: “People hear ‘no probate’ and think it means ‘no rules.’ It doesn’t. Trust administration has fewer procedural hurdles than probate, but the fiduciary standards are just as strict—maybe stricter, because there’s no court reviewing your decisions. You’re accountable directly to the beneficiaries, and they have legal rights whether you like it or not.”

What Happens When You Become Successor Trustee

When the original trustee dies or becomes incapacitated, you step in. The transition isn’t automatic—you need to establish your authority and take control of trust assets.

Establishing Your Authority:

Unlike probate, you don’t need court appointment. Your authority comes from the trust document itself. But you need to prove that authority to banks, title companies, and other institutions holding trust assets.

What you’ll need:

• The trust document (or relevant excerpts)
• Death certificate of the deceased trustee (or documentation of incapacity)
• Acceptance of trusteeship (your formal acceptance of the role)
• Certificate of Trust (also called an Affidavit of Trust or Certification of Trust)—a summary document that confirms you’re the trustee without revealing all the trust’s private terms
• Your identification

The Certificate of Trust is your working document. Under MCL 700.7913, third parties can rely on it without demanding the full trust document. We prepare these for our clients so you have a professional document that institutions will accept without hassle.

Taking Control of Assets:

Once you’ve established authority, you need to:

• Inventory all trust assets
• Retitle accounts into your name as successor trustee (e.g., “Jane Smith, Successor Trustee of the John Smith Revocable Trust dated January 1, 2020”)
• Secure real property
• Assess any immediate needs (ongoing bills, property maintenance, etc.)
• Understand the trust terms—what you can distribute, when, and to whom

The Critical First Step:

Read the trust. Actually read it.

You’d be amazed how many successor trustees start making decisions without fully understanding what the trust says. Distribution standards, discretionary powers, specific bequests, timing restrictions—it’s all in the document. The trust is your instruction manual. Ignore it at your peril.

Your Duties Under Michigan Law

The Michigan Trust Code doesn’t suggest how trustees should behave—it mandates it. These are legal obligations, and breach creates personal liability.

Duty of Loyalty (MCL 700.7802)

The trust beneficiaries’ interests come first. Period. Not your interests. Not your convenience. Not your family members who aren’t beneficiaries. You must administer the trust solely in the beneficiaries’ interests.

Self-dealing is prohibited. You can’t buy trust assets for yourself. You can’t sell your own assets to the trust. You can’t use trust funds for personal benefit. Any transaction where you’re on both sides requires extreme caution—and often court approval or beneficiary consent.

Duty of Impartiality (MCL 700.7803)

If there are multiple beneficiaries, you must act impartially. That doesn’t mean treating everyone identically—the trust terms may provide different treatment for different beneficiaries. But you can’t favor one beneficiary over another based on your personal preferences.

This gets tricky with current beneficiaries versus remainder beneficiaries. A surviving spouse might want maximum income distributions now. Children who inherit after the spouse dies might want assets preserved for the future. You balance competing interests according to the trust terms, not personal relationships.

Duty of Prudent Administration (MCL 700.7804)

You must administer the trust as a prudent person would, considering the purposes, terms, and circumstances. That means:

• Making informed decisions
• Exercising reasonable care and skill
• Incurring only reasonable costs
• Acting in good faith

If you have special skills or expertise (you’re an accountant, financial advisor, or attorney), you’re held to that higher standard. The trust selected you for a reason.

Duty Regarding Trust Property (MCL 700.7809)

Take control of trust assets promptly. Protect them. Don’t let property deteriorate. Maintain insurance. Keep assets properly titled. Don’t commingle trust funds with your personal accounts.

If the trust holds real estate, maintain it. If it holds investments, manage them appropriately. If it holds a business interest, ensure proper oversight.

Duty to Keep Beneficiaries Informed (MCL 700.7814)

Beneficiaries have the right to information. Under Michigan law, you must:

• Provide notice to qualified beneficiaries within 63 days of accepting trusteeship
• Respond to reasonable requests for information about trust administration
• Provide annual accounting (or more frequently if the trust requires it)
• Notify beneficiaries of any change affecting their interests

You can’t stonewall. You can’t hide. Beneficiaries have a legal right to know what’s happening with assets they have an interest in—even if you find their questions annoying.

Duty to Keep Records (MCL 700.7810)

Maintain clear, accurate records of all trust transactions. Every asset. Every distribution. Every expense. Every investment decision. Documentation protects you when questions arise—and questions always arise.

The Notice Requirement Most Trustees Miss

Here’s something that trips up even well-intentioned trustees: Michigan law requires you to notify qualified beneficiaries within 63 days of accepting your role as trustee.

Under MCL 700.7814, this notice must include:

• The existence of the trust
• Your identity and contact information
• Your acceptance as trustee
• The beneficiary’s right to request a copy of the trust document
• The beneficiary’s right to accountings

Why does this matter?

Two reasons. First, it’s the law. Skipping it is a breach of duty.

Second—and more practically—it starts the clock on important protections for you. Beneficiaries who receive proper notice have limited time to challenge certain actions. Beneficiaries who never received required notice have extended timeframes to cause you headaches. The 63-day notice isn’t a formality. It’s protection for everyone involved. Do it right, document it, and keep proof you sent it.

Distributions: Following the Trust Terms, Not Your Instincts

The trust document controls distributions. Your personal opinion about who deserves what is irrelevant.

Mandatory Distributions:

Some trusts require specific distributions. “All income to my spouse quarterly.” “Principal distributed in thirds at ages 25, 30, and 35.” “Specific bequest of $10,000 to my niece.” These aren’t discretionary—you must make them as directed.

Discretionary Distributions:

Many trusts give trustees discretion: “Distribute principal as the trustee deems appropriate for the beneficiary’s health, education, maintenance, and support.” You have judgment—but it must be exercised reasonably and in good faith.

What does that mean practically?

• Consider the beneficiary’s other resources
• Evaluate the request against the stated standard (HEMS: health, education, maintenance, support)
• Document your reasoning
• Don’t play favorites

You can say no to distribution requests. But you need a reason grounded in the trust terms—not personal animosity or your own opinion about how beneficiaries should live their lives.

Tax Planning Considerations:

Distributions to beneficiaries carry real tax implications that most successor trustees don’t consider—and getting this wrong can cost the trust (and its beneficiaries) thousands.

Here’s the core issue: trusts and estates hit the highest federal income tax brackets at astonishingly low income levels compared to individuals. For 2026, the trust and estate income tax brackets are:

• $0–$3,300: 10%
• $3,300–$11,700: $330 + 24% of amount over $3,300
• $11,700–$16,000: $2,346 + 35% of amount over $11,700
• Over $16,000: $3,851 + 37% of amount over $16,000

That top 37% rate kicks in at just $16,000 of undistributed trust income. For an individual, that same rate doesn’t hit until over $600,000. The compression is dramatic—and it means income retained inside the trust is taxed far more aggressively than income distributed to beneficiaries in lower individual brackets.

On top of that, the 3.8% Net Investment Income Tax (NIIT) applies to the lesser of undistributed net investment income or adjusted gross income exceeding the top bracket threshold ($16,000 for 2026). That effectively pushes the top combined rate above 40% on undistributed investment income.

These are 2026 figures—trust and estate tax brackets adjust annually. But the structural reality stays the same: trusts get crushed on taxes if income isn’t managed strategically.

This isn’t a one-size-fits-all calculation. It requires a case-by-case assessment and coordination with a CPA who understands trust taxation. Distributing income to beneficiaries in lower brackets might make sense—or it might not, depending on the trust language, the type of income, and each beneficiary’s situation. Some trusts are drafted with specific tax benefits for appreciation or income retained inside the trust.

We work with your tax advisors to ensure distributions are structured intelligently. The difference between thoughtful tax planning and ignoring the brackets can easily be tens of thousands of dollars over the life of a trust. Call (586) 991-7611 to discuss your trust’s specific tax situation with our team.Quotable Expert Statement: “The most common trustee mistake with distributions? Making them based on who asks nicely or who complains loudest. The trust document sets the rules. Your job is to follow them—not to be liked by everyone. Document your decisions, apply the standards consistently, and you’re protected. Make emotional decisions based on family politics, and you’re exposed.”

Creditors, Debts, and the Deceased Trustor’s Obligations

When the person who created the trust (the trustor or grantor) dies, their debts don’t automatically disappear. As successor trustee, you may need to address creditor issues—even though you’re not in probate court.

Revocable Trusts and Creditor Claims:

For revocable living trusts, trust assets are generally available to pay the deceased’s legitimate debts. Michigan law (MCL 700.7506) provides a procedure for notifying creditors and establishing a claims period—similar to probate, but handled through the trust rather than the court.

Using this procedure properly can protect you from personal liability and bar late-filed claims. Ignoring it can leave you exposed.

What You Should Do:

• Identify known creditors from the deceased’s records
• Consider whether to use Michigan’s trust creditor notice procedure
• Pay legitimate debts from trust assets before distributing to beneficiaries
• Document all creditor decisions

What Happens If You Distribute Too Early:

Same problem as probate: if you distribute trust assets to beneficiaries before addressing creditor claims, and valid creditors come forward, you could be personally liable for the unpaid debts. We help trustees navigate creditor issues strategically. Not every debt is valid. Not every creditor followed proper procedures. The same expertise we bring to probate creditor claims applies to trust administration.

Trust Administration Timeline: Faster Than Probate, But Not Instant

One of the main advantages of trusts is speed. No waiting for court appointment. No mandatory creditor claim period (unless you choose to use the statutory procedure). No court approval for distributions.

Typical Timeline for Straightforward Trust Administration:

Weeks 1–4: Establish authority, gather documents, inventory assets, retitle accounts, send beneficiary notices.

Months 2–4: Complete asset valuation, address any debts or expenses, file necessary tax returns, prepare for distribution.

Months 4–6: Make distributions, obtain beneficiary receipts and releases, prepare final accounting, close out trust administration.

Total: Many trust administrations complete in three to six months—significantly faster than probate’s typical nine to twelve months.

What Extends the Timeline:

• Real estate that needs to sell
• Tax complexity (estate tax returns, complex income tax situations)
• Beneficiary disputes or uncooperative beneficiaries
• Hard-to-value assets (business interests, collectibles, unusual property)
• Ongoing trusts that don’t fully distribute (trusts for minors, special needs trusts, continuing marital trusts)

Ongoing Trusts:

Not all trusts terminate at death. Some continue for years—providing for a surviving spouse for life, holding assets for minor children until they reach certain ages, or protecting a beneficiary with special needs indefinitely. If you’re administering an ongoing trust, you’re not just wrapping things up—you’re managing assets, making ongoing distributions, filing annual tax returns, and providing regular accountings. That’s a long-term commitment requiring sustained attention.

Trustee Compensation: Yes, You Can Get Paid

Trustees are entitled to reasonable compensation for their services. The trust document may specify compensation terms. If it doesn’t, you’re entitled to what’s reasonable under the circumstances.

What’s Reasonable?

Similar factors as personal representative compensation:

• Time and effort required
• Complexity of administration
• Size of trust assets
• Skill required
• Results achieved
• Local standards for similar services

Corporate trustees (banks, trust companies) typically charge annual fees of 0.5% to 1.5% of trust assets. Individual trustees often charge less—but you’re entitled to fair compensation for real work.

How to Handle It:

• Document your time and activities
• Be transparent with beneficiaries about compensation
• If the trust is silent on compensation, consider discussing expectations with beneficiaries upfront
• Take compensation as documented in your accountings

Tax Note:

Trustee compensation is taxable income to you. Factor that into your decisions about whether to take compensation or waive it (particularly if you’re also a beneficiary).

What Does Professional Trust Administration Cost in Michigan?

Here’s the honest answer: it depends entirely on what the trust says, what it was designed to do, and how long management is necessary.

That’s not a dodge—it’s the reality. Trust administration isn’t a one-size-fits-all service, and any attorney who quotes you a flat number without reading the trust document is guessing.

What Drives the Cost:

If the trust is straightforward—beneficiaries get paid out immediately and there’s only cash in a bank account—the legal fees might be a few thousand dollars. Gather the assets, send the required notices, make the distributions, file the final tax return, close it out. Relatively simple.

If the trust involves structured distributions over 20 years, ongoing in-depth management, investment oversight, annual tax filings, and regular accountings to multiple beneficiaries—you’re looking at ongoing attorney oversight costs that could range from a few thousand to $10,000+ per year, depending on the complexity.

Why It’s Still Worth It:

The costs of professional trust management are almost always outweighed by the benefits to the beneficiaries. Proper administration preserves creditor protections, optimizes investment growth, maintains eligibility for governmental benefits, and implements estate tax planning strategies. Cutting corners on administration to save fees often costs beneficiaries far more in the long run.

The Trust vs. Probate Comparison:

Here’s something most people don’t realize: apples to apples—trust administration versus probate administration with the same assets and the same scenario—trust administration could easily cost 50% less. Why? No excessive court oversight, no redundant filings, no waiting for judicial approvals. The entire bloated procedural framework that drives up probate costs simply doesn’t apply.

That’s the whole point of trusts. They’re designed to be more efficient. When administered correctly with proper legal guidance, they deliver on that promise.

To discuss what trust administration would look like for your specific situation, call (586) 991-7611. We’ll review the trust, assess the complexity, and give you a clear picture of what to expect.

Common Questions About Trust Administration in Michigan

Trust Administration Without the Guesswork

You’re holding a trust document and a pile of responsibility. No court is going to tell you what to do next. That’s the advantage of trusts—and the challenge.

Every notice you send, every distribution you make, every decision you document is either protecting you or exposing you. There’s no middle ground. And the beneficiaries watching have legal rights to enforce.

At Boroja, Bernier & Associates, we’ve guided hundreds of trustees through Michigan trust administration. We know what notices need to go out and when. We know how to handle creditor issues. We know how to document decisions so you’re protected if anyone questions them later.

Results over effort. We don’t bill for busywork. We bill for getting your trust administration done correctly, efficiently, and in a way that protects you when it’s over.

Call us. We’ll review the trust, explain what’s required, and give you a clear path forward. You’ve got enough to manage without guessing at the legal requirements.

Call Us: (586) 991-7611
Email: admin@bbalawmi.com

Office Hours: Monday–Thursday: 9:00 AM–5:00 PM | Friday: 9:00 AM–3:00 PM | Saturday & Sunday: By Appointment

Service Area: Boroja, Bernier & Associates represents trustees throughout Macomb County (Sterling Heights, Clinton Township, Warren, Shelby Township), Oakland County (Troy, Rochester Hills, Royal Oak, Southfield), Wayne County (Detroit, Livonia, Dearborn, Westland), Washtenaw County (Ann Arbor), Ingham and Eaton Counties (Lansing area), and surrounding communities. Headquarters in Shelby Township with additional offices in Troy, Ann Arbor, and Lansing.