Administering a trust for the benefit of one or more beneficiaries? Here are the duties you must adhere to:

Duty to Administer Trust: You must administer a trust according to law and terms set forth in the trust document. No matter how good your intentions, you may not administer the trust in some other manner.

Duty of Loyalty: You must administer the trust solely in the interest of the beneficiaries. You may not use the trust for your own benefit.

Duty of Impartiality: You may not favor one trust beneficiary over another. This is especially critical if you are a beneficiary.

Duty to Avoid Conflict of Interest: You may not enter transactions where your interest is adverse to the interests of the trust or its beneficiaries. For example, you generally may not loan personal funds to the trust, because this would result in a conflict between your duties to the trust and your duties to yourself. Further, you are prohibited from entering into transactions that will generate a profit for yourself.

Duty to Take Control of and Preserve Trust Property: You must take affirmative action to take, maintain control of, and preserve trust property.

Duty to Make Trust Property Productive: You must prudently invest trust property. In general, you have a duty to make that property productive.

Duty to Segregate Trust Assets: You must keep trust property separate from property not subject to the trust. For example, you should not keep personal funds and trust funds in the same bank account.

Duty to Report: You must keep beneficiaries informed with respect to matters involving the trust.

Duty to Account: You must provide beneficiaries with accounts, or detailed statements regarding the financial transactions of the trust. Legal accounts include beginning assets, ending assets, and all transactions that occurred in between (i.e., receipts, distributions, disbursements, gains and losses).

Duty to Reasonably Exercise Discretionary Powers: If the trust gives you discretion with respect to a matter, even if the discretion is “absolute” or “unfettered,” that doesn’t mean you can act however you like.