In a revocable trust estate plan, the owner of the trust has full control of their assets and how they are distributed. Revocable trusts are beneficial because they allow for the easy distribution of assets upon death without the need for probate.
Similar to how a will has executors or personal representatives, revocable trusts have trustees. They are appointed to assume fiduciary responsibility of the trust assets and manage it according to the wishes of the deceased.
Is it Legal to Name a Trustee in Another Country?
According to law, a person can name anyone they want as their trustee or fiduciary. It is legal to do so. However, there can be complications if the trustee assigned is in another country.
The Disadvantages of Having a Trustee in Another Country
The main disadvantage is that it can be difficult for a trustee to effectively manage a trust that is based overseas. Becoming a trustee carries a huge responsibility, and if they are in another country, they will have to do all the work over the phone or email. In some instances, the trustee would have the fly in to settle formal matters, which would be less than ideal considering the distance, extra costs, and time.
Another disadvantage is foreign trust taxation. There are rules that come with naming a trustee whose outside of the country, making it a weak choice bureaucratically and universally.
Who Should You Name as Trustee?
The key factor in naming a trustee is “trust.” A trustee should be someone that the trust owner has confidence in, considering that they will be managing the estate. If there’s anyone that a person trusts locally who can assume the responsibilities of managing the estate, then they are better candidates compared to someone in another country.
While it is legal to name a trustee in another country, there are many factors that can make it difficult to administer the trust. It’s better to name a trusted person locally, whether it be a family member or an expert.