Acting as a trustee involves understanding the legal basis for you to make certain decisions regarding a trust. This can include selling off property contained in the trust.
Without established authority to sell off trust assets, you could end up in probate court if the trust beneficiaries decide you lack the power to conduct any sales of trust property.
Trust documents as authorization
A trust is a legal arrangement where a trustee manages assets for beneficiaries. The terms of the trust, outlined in trust documents created by the trust creator, provide the rules and instructions you as the trustee must follow.
The trust documents give the trustee authorization to manage trust assets, which may include selling some or all of the trust property. The trust instructions should also tell you what to do with the profits, if you are to invest them or distribute them to beneficiaries, among other possibilities.
Beneficiary permission
If the trust documents grant you explicit powers and even requirements to sell trust assets, you should not need permission from beneficiaries unless the trust states otherwise. Still, having beneficiaries sign off on the property sales could further secure your position and prevent objections later on.
Trustees selling to themselves
You might also be a beneficiary of the trust. If other family members are beneficiaries, you may seek approval before selling trust assets to avoid conflicts. This can be especially important if you wish to sell trust property to yourself.
Since selling trust assets to yourself could be a problematic situation, it may be prudent to examine the trust documents carefully as they might forbid you from selling assets to yourself or to another trust you administer. However, this is less of a problem if you are also the trust creator and placed the property in the trust in the first place.
Managing a trust entails making sure you do not violate your fiduciary duty to trust beneficiaries. Maintaining transparency and avoiding financial decisions that appear to serve your interests above the beneficiaries can keep you from unnecessary litigation.
