Most people don’t grow up dreaming of becoming a trustee. Unless you’re a professional fiduciary, it’s not a job you apply for—it’s something you’re called to do, sometimes unexpectedly, and it usually shows up in a pretty emotional moment. Then you’re supposed to figure it out as you go.
If you’re in that position now, you’re probably juggling a lot. Maybe you’re trying to understand what the trust actually says. Maybe you’re feeling the weight of doing right by your family. Or maybe you’re worried about screwing up without realizing it. That’s completely normal.
In Wisconsin, trustees are held to a high legal standard. You’re expected to follow the trust’s terms, handle the assets with care, make decisions that are fair to everyone involved, and often deal with complex family dynamics. This guide is here to help. We’ll walk through your main responsibilities, flag a few common pitfalls, and share when it makes sense to reach out for help. And if you do need support, our Wisconsin estate administration attorneys are here to walk you through it.
What Exactly Is a Trustee?
It’s a fair question—and one a lot of people don’t ask until they’ve already been named one. A trustee is the individual, bank, or firm responsible for managing the assets held in a trust. Those assets might be money, a house, investments—anything the person who created the trust wanted handled a certain way. The trustee doesn’t own the assets, but they are responsible for managing and distributing them according to the trust’s instructions.
Under Wisconsin law, that means acting in good faith, sticking to the trust’s instructions, and making decisions that line up with your legal duty to the beneficiaries. In short, it’s a role that carries real weight.
Common ways a trustee may be appointed include:
- As part of a revocable or irrevocable living trust
- Under a testamentary trust established by a will
Through court appointment in certain probate or guardianship matters - By succession, when a prior trustee dies, resigns, or is removed
Trustees do not own trust property in a personal sense—they hold legal title solely to administer it on behalf of the beneficiaries. This role requires accountability, transparency, and loyalty to the trust’s stated objectives.
Core Legal Duties of a Trustee in Wisconsin
Trustees in Wisconsin are bound by fiduciary duties that are enforceable under law and cannot be casually delegated. These include:
Duty of Loyalty
You must act solely in the interest of the trust beneficiaries. Personal interests must not conflict with your responsibilities. Any form of self-dealing—such as benefiting personally from trust transactions—is a serious breach and can result in removal or personal liability.
Duty of Prudence (Care)
As a trustee, you’re expected to handle the trust the way a thoughtful, responsible person would in your shoes. That means paying attention to the trust’s purpose and what it says about how the money or property should be handled and shared. It also means making smart, careful decisions—especially around investing—and reaching out for professional help (like a financial advisor or attorney) when things are outside your comfort zone.
Duty to Follow the Terms of the Trust
You don’t get to rewrite the rules, even if you think there might be a better way. Your job is to carry out the instructions in the trust exactly as they’re written—unless a court says otherwise. Making changes on your own, even with good intentions, can create problems and put you at risk of legal trouble.
Duty to Inform and Communicate
Beneficiaries have a right to know what’s going on with the trust. That doesn’t mean you need to give a play-by-play, but you do need to keep them reasonably informed, answer their questions honestly, and provide any updates or reports the trust or the law requires. Good communication can prevent a lot of headaches down the road.
Duty to Account
You’ll need to keep track of everything—what comes in, what goes out, how assets are managed, and what the trust is worth at any given time. Clear and organized records, while helpful for you, are also required, and they can protect you if anyone ever questions how you’re doing your job.
Duty of Impartiality
If there’s more than one beneficiary, you have to treat them fairly. That doesn’t always mean treating them exactly the same (sometimes the trust says otherwise), but you can’t play favorites or let personal feelings get in the way. Your decisions should reflect what’s best for the trust, not just one person’s preferences.
Administrative Responsibilities of Wisconsin Trustees
Beyond legal duties, trustees are expected to fulfill practical, administrative tasks such as:
- Maintaining organized records and trust-related correspondence
Titling and managing trust-owned assets appropriately - Making timely and accurate distributions
- Filing federal and Wisconsin income tax returns for the trust
- Tracking income, expenses, and investment performance
- Coordinating with co-trustees, attorneys, accountants, or financial advisors as needed
Failure to properly handle tax obligations can result in penalties for the trust and personal liability for the trustee.
Where Things Tend to Go Sideways for Wisconsin Trustees
If a trustee doesn’t follow through on their responsibilities, the court can step in. Wisconsin law gives beneficiaries the right to take legal action if there’s a breach of trust. That can mean anything from asking the court to remove the trustee to ordering them to repay losses out of their own pocket. It’s a serious matter—and one more reason it’s so important to understand your duties from the start.
Common breaches include:
- Using trust assets for personal gain (self-dealing)
- Failing to make required or timely distributions
- Poor or speculative investment decisions
- Inadequate or disorganized recordkeeping
- Withholding information from beneficiaries
- Ignoring or misinterpreting the trust terms
These pitfalls can be avoided if you enlist the help of an established estate administration attorney early on.
When Can a Trustee Be Held Personally Liable?
If a trustee breaches a duty and causes loss or harm to the trust or its beneficiaries, they can be held personally liable, even for negligent errors. However, trustees acting in good faith and in accordance with the trust’s terms may be protected by indemnity provisions in the trust document or may have a valid defense under Wisconsin Stat. § 701.1009.
Trustees are not required by law to carry fiduciary liability insurance, but it is often a wise precaution, especially when the trust involves substantial or complex assets.
When Should You Contact a Wisconsin Trust Attorney?
If you’ve never served as a trustee and lack legal or business experience, begin preparing as early as possible to ensure you can fulfill the role effectively. If things feel confusing or heavier than you expected, it’s okay to ask for help. Reach out to a Wisconsin estate administration attorney and get the support you need.
