Why Your Professional Advisors and Trustee Should Be Talking to Each Other

Many families build an experienced team over the years: an estate planning attorney who drafted the trust, a CPA who handles tax filings, a financial advisor who manages investments, an insurance professional who helps address insurance needs, and a trustee who administers the trust itself. Each professional has a distinct role. What often goes unexamined is whether they are actually talking to one another.

Every Professional Sees a Different Piece of the Picture

An attorney typically focuses on drafting and updating legal documents. A CPA typically focuses on tax filings and reporting. A financial advisor typically focuses on investment management. An insurance professional may help review life insurance coverage, policy ownership, beneficiary designations, and liquidity needs. A trustee is responsible for administering the trust according to its terms, which can include managing assets, keeping records, and coordinating with other professionals as needed.

Each of these professionals approaches the family's plan from a different perspective, and no single professional necessarily has full visibility into what the others are doing unless information is being shared.

When a Plan Works on Paper but Not in Practice

An estate planning strategy can be built correctly and still fail to work as intended if the underlying details do not match. For example, a strategy that depends on how an asset is titled will not produce the intended result if that asset was never retitled to match the plan. This is not usually the result of any one professional making an error. It often happens because the attorney who designed the strategy, the CPA who reports on it, and the party responsible for retitling the asset were never working from the same complete picture.

A Plan Update That Doesn't Reach Everyone

Estate plans may need to be revisited as circumstances change, and families often do make those updates when appropriate. The update itself, however, does not automatically reach every professional involved. If an attorney amends a trust in a way that affects tax reporting, but the CPA is still working from the prior version, important information can be missed. If a trustee is not told about a change that affects how the trust should be administered, the plan on paper and the plan in practice can start to diverge.

The Trustee's Role in the Middle

A trustee may become an important point of coordination during trust administration. Administering a trust can require working with attorneys, CPAs, financial advisors, and other professionals to address legal questions, tax matters, investments, and distributions. A trustee who receives relevant updates from the rest of the team is better positioned to administer the trust consistently with its terms.

What Coordination Can Look Like

Coordination does not need to be complicated. Periodic check-ins or a simple process for sharing important updates can help ensure that the right professionals have the information they need. The goal is not to involve everyone in every decision, but to keep the attorney, CPA, financial advisor, and trustee informed when a change may affect their role. 

At inTRUST Counsel, we work alongside a family's existing attorneys, CPAs, and financial advisors as part of administering a trust, and we see firsthand how much smoother trust administration runs when that team is aligned. If you are working with several professionals and are not certain how well they are coordinating with one another, we are glad to help think it through.