No. of Recommendations: 2
mdtee7: "I am the trustee of my grandfather's testamentory trust. My mother (for whom I have POA) and 2 brothers, and myself, are the beneficiaries. I currently distribute income from the trusts. I work with an accountant who helps with the trust's taxes. May I distribute the entire contents to the beneficiaries? No beneficiary will object."

I assume that the two brothers are your brothers (and not your mother's brothers [i.e.. your uncle].

Does the trust have spendthrift provisions generally, or limitations on distributing capital?

If yes, then distributing contents may be problematic, especially if one of the beneficiaries then spends him/herself broke and sues for loss of income from the trust. Or what if a creditor of one of the beneficiaries attaches the newly distributed trust assets?

Also, do you as trustee have discretion as to who gets the income or are you required to distribute equally? If the former, then your grandfather wanted that for a reason, and early distribution of trust assets would frustrate your grandfather's intent.

If it were me, I would not distribute capital except according to the terms of the trust or with court approval to distribute trust assets early.

Just my $0.02.

Regards, JAFO
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