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What Every Trustee Should Know About Tax for Estates

The standard of care in the administration of trusts and estates is a crucial, yet often overlooked aspect of estate administration. Each trustee is accountable to the trust beneficiaries and must fulfill many important duties in a timely, responsible manner. If a trustee fails to adhere to the duties imposed on them by the law, the beneficiaries have a virtually limitless number of rights against them.

To assist with the complex realm of estate administration, trustees can retain advisors in areas including taxes among others. However, if the trustee does not do so, and does not gain the knowledge reasonably necessary to properly execute the trust, the trustee will be held liable to the beneficiaries for breach of fiduciary duty. For this reason, you have to learn what you’re supposed to do, which is the easy way to avoid being forced to learn the hard way.

Tucker Cheadle is a licensed trustee, attorney, and tax expert. As a professional trustee, he has acted as a fiduciary, trustee, executor, and administrator on more than 100 trusts and wills for over four decades. He has proved his industry knowledge, reliability, and ability to articulate himself coherently and concisely through a long career testifying as an expert witness, particularly in relation to the standard of care involving the administration of trusts and estates throughout California.

For example, in a case filed in San Bernardino County, Tucker Cheadle testified as an expert witness in a breach of fiduciary duty claim filed by trust beneficiaries against the trustee.

Here is a brief overview of the facts:
  1. The trustee retained undeveloped, unimproved real estate rather than selling it because of his erroneous understanding of the tax laws and how these laws applied to this particular trust asset.
  2. The trustee erroneously believed that if he sold the real estate, he would have had to pay taxes on capital gains.
Because of his erroneous decision to retain the land instead of selling it, the value of the trust asset declined by 60%. Additionally, the trustee incurred unnecessary, expensive legal and accounting fees for the trust even though the proper course of action was to sell the land.

In this case, Tucker Cheadle testified in deposition about the trustee’s breach of fiduciary duty in the administration of the trust, resulting in a quick settlement of the case immediately following his expert opinion. The former trustee was forced to learn what he was supposed to do the hard way, because of his unwillingness to initially learn the easy way.

Due to Tucker Cheadle’s unique qualifications as a trust administration and taxation attorney, tax expert, and licensed trustee, he has testified as an expert witness in Los Angeles County, Orange County, the surrounding counties of Riverside, San Bernardino, San Diego, Santa Maria, and the cities of Reno, Nevada and Cleveland, Ohio. He has testified in the following areas related to the administration of estates and trusts:
  1. Trust and estate accountings
  2. Trust and estate accountings’ compliance with California Probate Code’s requirements
  3. Estate taxes
  4. Investments of trust assets
  5. Preparation of income tax returns
Tucker Cheadle has the knowledge and experience to advise trustees, beneficiaries, administrators of trusts and estates, and drafters of estate planning documents on virtually all aspects of trusts and estates.

Call Tucker Cheadle at 949-553-1066 to discuss your trust or estate planning expert witness needs.

A review of any materials on this web page, any preliminary comments or an introductory meeting does not constitute legal, income tax or accounting advice upon which reliance can be placed. The attorney client relationship can only be created by a written retainer agreement following a check of potential and actual conflicts of interest with other clients.
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Tucker Cheadle Trust Administrator

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