In this article, we explain how to object to a trust accounting in Illinois. Our Illinois trust attorneys answer:
- What is a trust accounting in Illinois?
- What does a trust accounting need to include in Illinois?
- Who can object to a trust accounting in Illinois?
- How to object to a trust accounting in Illinois
- 2020 Illinois trust accounting law changes
What Is a Trust Accounting in Illinois?
Section 11 of the Illinois Trust and Trustees Act 760 ILCS 5/1 et seq. sets forth a trustee’s duty to account a trust. Trust accounting is required for all types of trusts and must be filed annually (at a minimum).
When a trustee completes a trust accounting, they must file all associated paperwork with the Illinois court system, including receipts, disbursements, and inventory of the trust estate. All documents must be made available and shared with the trust estate’s beneficiaries, whether they currently receive benefits or stand to receive benefits at a later date.
What Does a Trust Accounting Need to Include in Illinois?
A proper trust accounting in Illinois is required to include:
- An inventory of all trust assets on the date of the decedent’s passing.
- A detailed description of all expenditures and disbursements, including where each disbursement was paid and the expenditure’s purpose.
- A detailed description of all income received by the trust, including where the income is derived from and the type of income.
If a trust accounting does not include all of these criteria, then an objection may be made.
Who Can Object to a Trust Accounting in Illinois?
If a beneficiary believes that a trustee is withholding information or mismanaging the affairs of a trust, they have the right to object to the trust accounting and should consult with a qualified trust-litigation attorney.
How to Object to a Trust Accounting in Illinois
A trustee cannot hide information in order to protect themselves from the beneficiaries’ objections or legal actions. The statute mandates that the accounting be detailed and specific so that all parties have a full understanding of a trust’s assets.
If a party with standing rights, such as a beneficiary, believes a trust accounting report to be incorrect, whether by human error or deliberately, they have the right to object as an interested party by filing a misleading or confusing accounting objection.
They may also obtain permission from the court to force discovery in the form of bank records and other financial evidence. The trustee may also be deposed, and witnesses may be interviewed to determine if a trustee has mismanaged a trust’s assets.
2020 Illinois Trust Accounting Law Changes
The new Illinois Trust Code, or ITC, will go into effect on January 1, 2020. The ITC includes multiple changes trustees should be aware of. All existing irrevocable and revocable trusts should be reviewed by trustees, executors, and estate planners as soon as possible to ensure all administration procedures and terms conform to the new laws.