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Trust Accountings for Irrevocable Trusts

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There are a lot of duties and responsibilities that come with being the trustee of a loved ones irrevocable trust. One of those duties is to keep good records. Another duty is to keep qualified beneficiaries reasonably informed about the administration of the trust. This means the trustee should respond promptly to any reasonable request for information from the beneficiaries. This includes providing information about assets in the form of financial reports or trust accountings.

What should accountings include?

Accounting requirements vary from jurisdiction to jurisdiction. In 2008, Arizona adopted the Uniform Trust Code (UTC). The UTC requires that trustees create “financial reports.” While these are not called accountings, they are very similar.  These reports should include any trust property, liabilities, disbursement, records of the trustees compensation, receipts, trust assets and their market value. They should also include any changes in types of assets.

There is no set format required for the accountings and the description provided is fairly vague. In general, the people you send the accounting to, should be able to gather a general idea of the assets in the trust, how they are changing and being spent. A typical accounting includes at least an opening balance for the period, the debits (assets that came into the trust), credits (assets that went out of the trust), an ending balance for the period, and a summary. It may also be beneficial to separate assets allocated towards principal and income in your accountings.

Can the trustee prepare the accountings themselves?

It depends. If the trust assets are fairly simple, and the trustee has some financial know-how a trustee may be able to prepare their own accounting. This is even more likely to be true, if your trustee is a financial institution or a professional fiduciary. If trust assets are complex, or the trustee doesn’t feel comfortable preparing the accounting, it may be best to seek help from a professional. A CPA or bookkeeper should be able to help. If your accounting must be filed with the court, make sure you are filing an accounting that complies with the formatting of the court you are filing it with.

How often does the trustee need to prepare accountings?

How often a trustee needs to prepare an accounting varies from jurisdiction to jurisdiction. Many states require annual accountings or financial reports. Arizona statute requires that the trustee provide financial reports at least annually and at the termination of the trust. While the statute requires accountings at least annually, beneficiaries may request more frequent accountings so long as it is reasonable. A beneficiary can also waive their right to a formal accounting and they may want to in order to save time and expense. If a beneficiary is waiving their right to an accounting, the it is best practice for the trustee to get that in writing. The trust document may also have guidelines for how often accountings need to be sent to beneficiaries or distributees.

Who should receive the accountings?

Who the trustee is required to share trust accountings with also varies between jurisdictions. You have to provide an accounting to the beneficiaries to the trust. You may also have to provide an accounting to the trust protector, if there is one. In Arizona, the trustee is required to send accountings to qualified beneficiaries (beneficiaries who are entitled to distributions of income and/or principal currently). They also have to provide accountings to contingent beneficiaries that would be entitled to income or principal after one event, like the death of another beneficiary.

So, for example. Pretend there is an irrevocable trust. Parent is the current beneficiary. Child is a contingent beneficiary, who will be entitled to trust income and principal upon Parent’s death. Grandchild is a contingent beneficiary, entitled to distributions only on the death of Parent and Child. The trustee would need to send accountings or financial reports to Parent and Child, but not grandchild.

The trustee however, does not have to automatically send accountings to beneficiaries who will inherit only if several other beneficiaries die before the trust is scheduled to end. For example, you probably do not have to automatically send the accounting to the back up for the back up beneficiary who is unlikely to receive trust assets anyways. If these remote beneficiaries reasonably request an accounting, the trustee would still likely have to provide it though.

Once you have completed the accounting, you can send it via mail. When you do, keep the receipt showing the date you sent it. In some jurisdictions, there is a deadline for beneficiaries to file a law suit after receiving the accounting. In those states, once the deadline has passed, the trustee’s liability is limited.

One Response

  1. Thank you, as always, for your effort in producing the “Elder Law Issues.” I find them timely and informative.

    Regarding trust accountings, however, I am thinking it would be good to emphasize that, apparently, ensuring that trust beneficiaries receive reports or accountings and other information about a trust, or even become aware of its existence after the settlor’s death, is not a high priority for the Arizona Legislature.

    A.R.S. § 14-10813 is a default provision, and, except for the trustee’s duty to respond to the request of a qualified beneficiary of an irrevocable trust for trustee’s reports and other information reasonably related to the administration of the trust, may be waived by the trust instrument. See A.R.S. § 14-10105(B)(8). Such a provision begs the question: how to qualified beneficiaries know to inquire about trustee’s reports and other information if the duty to provide them with notice of the trust’s existence has been waived?

    I have seen many trust forms containing boilerplate which purport to make the trust “private” and “confidential,” and excuse the trustee from revealing any information not required to be disclosed by Arizona law. Some successor trustees often take full advantage of such a provision to the detriment of the beneficiaries.

    Does anyone imagine that the typical settlor, who has four children, and who has designated one of them to serve as successor trustee, intends that child to keep the trust and administrations secret from the other beneficiaries?

    Somehow, prospective trust clients need to be educated on this point and encouraged to inquire on these matters and insist that the privacy and confidentiality boilerplate be eliminated to the extent that it authorizes the trustee to withhold information from the beneficiaries.

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Robert B. Fleming


Robert Fleming is a Fellow of both the American College of Trust and Estate Counsel and the National Academy of Elder Law Attorneys. He has been certified as a Specialist in Estate and Trust Law by the State Bar of Arizona‘s Board of Legal Specialization, and he is also a Certified Elder Law Attorney by the National Elder Law Foundation. Robert has a long history of involvement in local, state and national organizations. He is most proud of his instrumental involvement in the Special Needs Alliance, the premier national organization for lawyers dealing with special needs trusts and planning.

Robert has two adult children, two young grandchildren and a wife of over fifty years. He is devoted to all of them. He is also very fond of Rosalind Franklin (his office companion corgi), and his homebound cat Muninn. He just likes people, their pets and their stories.

Elizabeth N.R. Friman


Elizabeth Noble Rollings Friman is a principal and licensed fiduciary at Fleming & Curti, PLC. Elizabeth enjoys estate planning and helping families navigate trust and probate administrations. She is passionate about the fiduciary work that she performs as a trustee, personal representative, guardian, and conservator. Elizabeth works with CPAs, financial professionals, case managers, and medical providers to tailor solutions to complex family challenges. Elizabeth is often called upon to serve as a neutral party so that families can avoid protracted legal conflict. Elizabeth relies on the expertise of her team at Fleming & Curti, and as the Firm approaches its third decade, she is proud of the culture of care and consideration that the Firm embodies. Finding workable solutions to sensitive and complex family challenges is something that Elizabeth and the Fleming & Curti team do well.

Amy F. Matheson


Amy Farrell Matheson has worked as an attorney at Fleming & Curti since 2006. A member of the Southern Arizona Estate Planning Council, she is primarily responsible for estate planning and probate matters.

Amy graduated from Wellesley College with a double major in political science and English. She is an honors graduate of Suffolk University Law School and has been admitted to practice in Arizona, Massachusetts, New York, and the District of Columbia.

Prior to joining Fleming & Curti, Amy worked for American Public Television in Boston, and with the international trade group at White & Case, LLP, in Washington, D.C.

Amy’s husband, Tom, is an astronomer at NOIRLab and the Head of Time Domain Services, whose main project is ANTARES. Sadly, this does not involve actual time travel. Amy’s twin daughters are high school students; Finn, her Irish Red and White Setter, remains a puppy at heart.

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Matthew M. Mansour


Matthew is a law clerk who recently earned his law degree from the University of Arizona James E. Rogers College of Law. His undergraduate degree is in psychology from the University of California, Santa Barbara. Matthew has had a passion for advocacy in the Tucson community since his time as a law student representative in the Workers’ Rights Clinic. He also has worked in both the Pima County Attorney’s Office and the Pima County Public Defender’s Office. He enjoys playing basketball, caring for his cat, and listening to audiobooks narrated by the authors.