Illinois Trust Administration

The settlor died and the trust document names you as successor trustee. Illinois gives you a deadline clock before it gives you anything else. Under 760 ILCS 3/813.1, you have 90 days to notify every qualified beneficiary that the trust exists and 90 days from accepting the job to send them your name, address, and phone number. From there you gather and protect the property, pay what the settlor owed, send a trust accounting at least once a year, and distribute. Most of it happens without a judge.

The Illinois Trust Code, 760 ILCS 3/, took effect January 1, 2020 under Public Act 101-48 and replaced the old Trusts and Trustees Act at 760 ILCS 5/, which that same act repealed. Older articles and forms that point a successor trustee to 760 ILCS 5/ are citing a statute that is no longer on the books. Everything below runs off the current Code, with the section numbers so you can read the text yourself.

First, Find Out Which Accounting Rule Governs You

Illinois split its trustee reporting duty into two sections, and which one applies to you depends on a single date. Get this wrong and you either send notices nobody was owed or you miss the ones you were.

Section 813.1 governs trusts that became irrevocable after January 1, 2020. A revocable living trust becomes irrevocable when the settlor dies. If your settlor died in 2020 or later, you are under 813.1, with its 90-day notices and its annual accountings to a wider group of people.

Section 813.2 governs trusts that became irrevocable before January 1, 2020, and trustees who accepted the job before that date. Think of a bypass trust or a family trust that locked in at a first spouse's death in 2012. That older trust owes an annual current account to the income beneficiaries and a final account on termination. It carries no 90-day notice duty.

Section 813.1 also says it supplants the common law duty to inform and account. So the statute, not a general fiduciary principle, sets the floor for what you owe. The trust document can raise the floor and in some respects lower it, which is why you read the document before you read anything else.

Step 1: Decide Whether to Accept, and Watch the 120-Day Clock

Under 760 ILCS 3/701, you accept the trusteeship by following whatever method the trust instrument sets out, or by taking delivery of trust property, exercising trustee powers, or otherwise showing you accepted.

Illinois adds a rule many states skip. A designated trustee who does not accept within 120 days after receiving notice of the designation is deemed to have declined. Silence is an answer here, and it is "no." If you want the job, act inside 120 days.

You can also protect the property while you make up your mind. Section 701(c) lets you act to preserve trust property, and inspect it for environmental or other liability, without that counting as acceptance, so long as you send a declination inside the same 120 days. Good faith actions taken that way carry no liability.

Before you accept, read the whole instrument plus every amendment. Note who the beneficiaries are, what each one takes, whether any sub-trusts continue after distribution, what the document says about your fee, and who serves if you step down.

Step 2: Take Control of the Property and Set Up Records

Section 809 tells you to take reasonable steps to take control of and protect the trust property, and it names one task by hand: searching for and, where practicable, claiming any unclaimed property.

Section 810 sets the recordkeeping rules, and two of its subsections came from recent amendments that took effect January 1, 2025 and January 1, 2026:

Keep adequate records of the administration.
Keep trust property separate from your own property. No commingling, ever.
Title trust property so the trust's interest shows in records held by someone other than you or a beneficiary.
Keep a copy of the governing trust instrument for at least 7 years after the trust terminates.
Before the trust terminates, run a reasonable search for trust property that was reported and remitted to a state unclaimed property administrator.

That last one is easy to skip and easy to do. The Illinois State Treasurer runs the state's unclaimed property program, and a settlor who moved banks a few times often left something behind.

Practical setup work in the first weeks:

Order 10 to 15 certified death certificates. Banks, title companies, and transfer agents each keep their own.
Get an EIN for the trust from the IRS. While the settlor was alive the trust used the settlor's Social Security number. That ends at death.
Open a checking account in the trust's name under the new EIN and run every dollar through it.
Secure the house, vehicles, and papers, and keep property and casualty insurance in force.

Step 3: Send the 90-Day Notices

This is where new Illinois trustees get into trouble. Section 813.1 requires two separate notices, both on 90-day clocks.

Notice of the trust's existence. Within 90 days of the trust becoming irrevocable, or within 90 days of your acceptance if no trustee was then acting, notify each qualified beneficiary of:

the trust's existence,
the beneficiary's right to request a complete copy of the trust instrument (or, if the instrument says so, only the portion setting out the terms in which that beneficiary has an interest), and
whether the beneficiary has a right to receive or request trust accountings.

The same 90-day clock restarts when you learn a qualified beneficiary has gained or lost a representative under Article 3, and when you learn there is a new qualified beneficiary.

Notice of your acceptance. Under Section 813.1(d), within 90 days after accepting the trusteeship, notify each qualified beneficiary that you accepted and give them your name, address, and telephone number. You also have to tell qualified beneficiaries in advance of any change in the rate or method of your compensation, tell them if you resign, tell them within 90 days if a co-trustee dies or is removed, and tell them within 90 days if your own contact information changes.

Who Counts as a Qualified Beneficiary

Article 1 of the Code defines the term, and it is broader than "the people getting money now." A qualified beneficiary is each current beneficiary plus each presumptive remainder beneficiary. A current beneficiary is a distributee or permissible distributee of income or principal on the date you measure. A presumptive remainder beneficiary is someone who would take if the trust terminated on that date, or who would take if the interests of everyone currently eligible ended without ending the trust.

Read that twice before you build your notice list. A remainder beneficiary who will not see a dollar for twenty years still gets your 90-day notice and your annual accounting.

Send every notice in writing and keep a dated copy. Section 813.1(h) gives you a presumption of receipt if you have mailing or delivery procedures in place, including electronic delivery where the beneficiary agreed to it. That presumption is worth building a paper trail for.

Step 4: Inventory and Value the Trust Property

Build a full list of what the trust owns and what each item was worth on the date of death:

Real estate, with a date-of-death appraisal for each parcel
Bank accounts, certificates of deposit, and brokerage accounts
Retirement accounts or life insurance naming the trust as beneficiary
Closely held business interests
Vehicles, jewelry, collectibles, and household goods

Date-of-death values set the beneficiaries' stepped-up basis when they later sell, and they feed any estate tax filing. Get a written appraisal for real estate, business interests, and anything unusual.

Section 813.1(b)(8) gives you room on hard-to-value assets. For an asset or class of assets with no readily available market value, you decide whether to estimate the value or carry it at a nominal value, how to estimate it, and whether and how often to hire a professional appraiser. That is discretion, not permission to guess and forget.

Assets the Trust Never Owned

A trust controls only what was actually retitled into it. If the settlor signed a deed or opened an account and never moved it into the trust, that asset sits outside your reach. It may pass by beneficiary designation, by an Illinois transfer on death instrument, by a small estate affidavit, or through probate in Illinois. A pour-over will catches leftovers and sends them to the trust, but usually only after the court process runs. Sort this out early, because the answer changes who you have to deal with for the next year.

Step 5: Administer the Trust the Way the Code Requires

Once you accept, five duties apply from day one:

Section 801, good faith. Administer the trust in good faith, in accordance with its purposes and terms and with the Code.
Section 802, loyalty. A transaction you enter for your own account, or one tainted by a conflict between your fiduciary and personal interests, is voidable by an affected beneficiary, and you must disgorge any profit if it is voided. Buying the settlor's house from the trust at a friendly price is the classic way to lose this fight.
Section 803, impartiality. With two or more beneficiaries, treat them equitably against the trust's purposes and terms, including any stated intent to favor one of them.
Section 804, prudent administration. Administer the trust as a prudent person would, with reasonable care, skill, and caution.
Section 805, costs. Incur only costs that are reasonable in relation to the trust property and the trust's purposes.

If the trust holds investments you will manage for more than a few months, Article 9 of the Code, the Illinois Prudent Investor Law at 760 ILCS 3/900 and following, sets the investment standard. Section 902 judges you on the portfolio as a whole rather than on any one holding, and it lists what you may weigh, including economic conditions, inflation, tax consequences, expected total return, and the duty to incur only reasonable costs. Section 901 makes the rule a default that the trust instrument can expand, restrict, or eliminate, and it protects a trustee who relies on those express terms in good faith.

Step 6: Pay the Settlor's Debts and Taxes First

Trust assets are not automatically beyond the reach of the settlor's creditors. Section 505(a)(5) says that after the settlor dies, property of a trust that was revocable at death is subject to the settlor's creditors, the costs of administering the settlor's estate, funeral and disposal expenses, and the statutory awards to a surviving spouse and children, to the extent the probate estate is inadequate to cover them. Beneficiaries take what is left after that.

Two limits work in your favor. A claim already barred against the personal representative is barred against the trust as well, so the Illinois claim deadlines that run in probate protect the trust too. And when the probate estate does fall short, Sections 18-10 and 18-13 of the Probate Act control the classification and priority of payment out of trust property, the same order a court would apply to an estate.

Then there is the safe harbor most trustees should plan around. Under Section 505(a)(6), you are released from liability under that section for assets you distribute in line with the trust instrument if two things are true:

You made the distribution 9 months or later after the settlor's death, and
You never received a written notice from the decedent's personal representative saying the probate estate is or may be insufficient to pay allowed claims, or you did receive one and it was withdrawn or revoked before you distributed.

Nine months is the number to write on the calendar.

Tax filings to line up with a CPA:

The settlor's final Form 1040 for the year of death, and the matching Illinois return
Federal Form 1041 and the Illinois fiduciary return for trust income earned after death
Illinois estate tax, which starts at a $4,000,000 exclusion that is not portable between spouses and is filed with the Illinois Attorney General under 35 ILCS 405/, and the federal return if the estate exceeds the federal exclusion. The Illinois estate tax guide works through both.

Pay debts and taxes before beneficiaries. Distribute first and you may be covering the shortfall yourself.

Step 7: Send Trust Accountings

Section 813.1 sets three separate accounting duties for a post-2020 trust:

At least annually, send a trust accounting to all current beneficiaries.
At least annually, send a trust accounting to all presumptive remainder beneficiaries.
On termination, send a trust accounting to every beneficiary entitled to receive a distribution of the residue.

Section 813.1(b)(7) then gives you a clean discharge. Provide the 90-day notice to each qualified beneficiary and provide the annual and termination accountings to each beneficiary entitled to one, and you are deemed to have fully discharged your duty to inform and account, at common law or otherwise.

A qualified beneficiary can waive the right to an accounting in a signed writing delivered to you, and can withdraw that waiver later as to future accountings. Take waivers in writing or not at all.

The Two-Year Clock a Good Accounting Starts

Sending accountings protects you, and Section 1005 is the reason. For a trust that became irrevocable after the Code took effect, a matter disclosed in writing by a trust accounting becomes binding on everyone who received it, and on their successors, heirs, and assigns, unless suit is filed within 2 years of the date the information was furnished. The statute sets the disclosure standard: the accounting adequately discloses a potential breach claim if it gives enough information that the reader knows of the claim or should have asked about it.

For older trusts under Section 813.2, the window is 3 years from the date the account was furnished. Separately, Section 1005(b) bars any beneficiary suit for breach more than 5 years after the first of your removal, resignation, or death, the end of that beneficiary's interest, or the end of the trust. Fraudulent concealment runs on its own clock under Section 13-215 of the Code of Civil Procedure.

Thin, vague accountings start no clock. Detailed ones do.

Step 8: Distribute and Close the Trust

Section 817 tells you to proceed expeditiously once a termination event happens, and it hands you three protections on the way out:

You may require a beneficiary's written approval of the trust accounting you gave them. An approval given under Section 817 binds that beneficiary and the beneficiary's successors, heirs, representatives, and assigns.
You may require a refunding agreement, so a beneficiary who took a distribution has to give back their share of a liability that later surfaces.
You may withhold a reasonable amount or hold a reasonable reserve for debts, expenses, and taxes while you wait on that approval and refunding agreement, or on a judicial settlement of accounts.

Use all three. A signed approval plus a refunding agreement plus a modest reserve is the difference between closing a trust and reopening your checkbook.

Timing runs off two more sections. Section 604(b) says that 9 months after the settlor's death you may distribute in accordance with the trust instrument without liability, unless you know of a pending contest, or a potential contestant told you a suit was coming and files within 60 days of that notice. That lines up with the 9-month creditor safe harbor in Section 505(a)(6), which is why 9 months is the practical waiting period for an Illinois trust distribution.

Section 604(a) sets the contest window itself. Someone may sue to contest a trust that was revocable at the settlor's death only within the earlier of 2 years after the death, or, where no will carrying a legacy to the trust is admitted to probate, 6 months after you send that person a copy of the trust instrument along with a notice of the trust's existence, your name and address, and the 6-month deadline. Sending that package is how a trustee shortens a two-year exposure to six months. If a contest is already brewing, read the Illinois will and trust contest rules before you distribute anything.

To move Illinois real estate to a beneficiary, sign and record a trustee's deed with the county recorder where the land sits. Get a signed receipt for every distribution. Keep any continuing sub-trusts running under their own terms, including an Illinois pet trust if the document created one.

What You Are Not Responsible For

New successor trustees often assume they inherit the last trustee's mistakes. Illinois says otherwise. Section 812 gives a successor trustee all the rights, powers, and duties of the predecessor, then adds two protections:

You have no duty to inquire into the acts or doings of a predecessor trustee, and you are not liable for any act or failure to act of that predecessor.
With the approval of a majority in interest of the beneficiaries then entitled to or eligible for trust income, you may accept the predecessor's account and the property received as a full discharge of the predecessor without taking on liability yourself.

You are also unlikely to owe a bond. Under Section 702, a trustee posts bond only if the court finds one is needed to protect the beneficiaries or the trust instrument requires it and the court has not waived it.

And you can be paid. Section 708 gives you compensation that is reasonable under the circumstances when the instrument is silent. When the instrument sets your fee, you take what it says, though a court may adjust the amount if your duties turned out to be far different from what the trust contemplated or the stated fee is unreasonably low or high. Section 709 reimburses you out of trust property, with interest where appropriate, for expenses properly incurred in administering and protecting the trust. Many family trustees waive a fee. If you take one, disclose it in your accounting and give qualified beneficiaries advance notice of any change in how it is figured.

Common Questions

Do I have to open a court case to administer an Illinois trust?

No. Trust administration runs outside court unless a dispute arrives. Section 813.1(i) does let you ask a court to approve a current or final accounting at your election, with the reasonable and necessary costs paid by the trust and allocated between income and principal under the Principal and Income Act. Trustees use that when a beneficiary is hostile or the numbers are contested.

How soon can I distribute after the settlor dies?

Section 604(b) points to 9 months after death, and Section 505(a)(6) uses the same 9-month mark for the creditor safe harbor. Earlier distributions are legal, and they carry the risk that a creditor claim or a contest lands after the money is gone.

What if the trust names me but I do not want the job?

Decline in writing inside 120 days of receiving notice of your designation. Section 701(b) treats a designated trustee who has not accepted within 120 days as having declined. If you decline and no successor is named, Section 704 fills the vacancy in order: the person the instrument designates, then a person appointed by a majority of the beneficiaries who receive or may receive trust income, then a person the court appoints.

Does a remainder beneficiary get to see my accounting?

Yes, under a post-2020 trust. Section 813.1(b)(3) requires an annual trust accounting to all presumptive remainder beneficiaries, not only to the people receiving income now.

Can a beneficiary force me out?

A settlor, a co-trustee, or a qualified beneficiary can ask the court to remove a trustee, and a court can act on its own. Section 706 lists the grounds, including a serious breach of trust, co-trustee deadlock that impairs administration, unfitness or persistent failure to administer effectively, and a major change of circumstances where a suitable successor is available and removal serves all the beneficiaries.

The trust holds a house. Do I sell it or transfer it?

That depends on the trust's terms and on what the beneficiaries want. A specific gift of the house goes by trustee's deed. Property in the residue often sells so the proceeds can be split. If a sale is coming, the date-of-death appraisal you ordered in Step 4 sets the basis, and the guide on selling inherited Illinois property walks through the sale itself.

This guide is general information about Illinois trusts and estates. Statutes change, trust documents override defaults in places, and the facts of a particular trust decide the answer, so confirm anything that affects your administration with a licensed Illinois attorney or a CPA before you act.

Sources:

Title: 760 ILCS 3/801 through 3/821, Duties and Powers of Trustee (including 801 duty to administer, 802 loyalty, 803 impartiality, 804 prudent administration, 805 costs, 809 control and protection of trust property, 810 recordkeeping, 812 powers and duties of successor, 813.1 duty to inform and account, 813.2 pre-2020 trusts, 817 distribution upon termination). Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Illinois Trust Code, accessed July 19, 2026. URL: https://www.ilga.gov/Legislation/ILCS/details?ActID=4001&ChapterID=61&ChapAct=760+ILCS+3%2F&SeqStart=7400000&SeqEnd=9700000
Title: 760 ILCS 3/701 through 3/709, Office of Trustee (701 accepting or declining trusteeship and the 120-day rule, 702 trustee's bond, 704 vacancy and successor appointment, 706 removal, 708 compensation, 709 reimbursement of expenses). Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Illinois Trust Code, accessed July 19, 2026. URL: https://www.ilga.gov/Legislation/ILCS/details?ActID=4001&ChapterID=61&ChapAct=760+ILCS+3%2F&SeqStart=6400000&SeqEnd=7400000
Title: 760 ILCS 3/505, Creditor's claim against settlor (subsection (a)(5) reaching revocable trust property when the probate estate is inadequate; subsection (a)(6) the 9-month release from liability). Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Illinois Trust Code, accessed July 19, 2026. URL: https://www.ilga.gov/Legislation/ILCS/details?ActID=4001&ChapterID=61&ChapAct=760+ILCS+3%2F&SeqStart=4800000&SeqEnd=5800000
Title: 760 ILCS 3/603 and 3/604, Revocable Trusts (603 settlor's powers and standing; 604 limitation on contesting a revocable trust and the 9-month distribution rule). Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Illinois Trust Code, accessed July 19, 2026. URL: https://www.ilga.gov/Legislation/ILCS/details?ActID=4001&ChapterID=61&ChapAct=760+ILCS+3%2F&SeqStart=5800000&SeqEnd=6400000
Title: 760 ILCS 3/1005, Limitation on action against trustee (2-year bar after a trust accounting for post-2020 trusts, 3-year bar for earlier trusts, 5-year outer limit). Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Illinois Trust Code, accessed July 19, 2026. URL: https://www.ilga.gov/Legislation/ILCS/details?ActID=4001&ChapterID=61&ChapAct=760+ILCS+3%2F&SeqStart=11300000&SeqEnd=12800000
Title: 760 ILCS 3/103, Definitions (current beneficiary, presumptive remainder beneficiary, qualified beneficiary). Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Illinois Trust Code, accessed July 19, 2026. URL: https://www.ilga.gov/Legislation/ILCS/details?ActID=4001&ChapterID=61&ChapAct=760+ILCS+3%2F&SeqStart=100000&SeqEnd=1700000
Title: 760 ILCS 3/900 through 3/902, Illinois Prudent Investor Law (prudent investor rule as a default, standard of care and portfolio strategy). Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Illinois Trust Code, accessed July 19, 2026. URL: https://www.ilga.gov/Legislation/ILCS/details?ActID=4001&ChapterID=61&ChapAct=760+ILCS+3%2F&SeqStart=9700000&SeqEnd=11300000
Title: 760 ILCS 3/, Illinois Trust Code (article listing, effective January 1, 2020 under Public Act 101-48). Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Not listed. URL: https://www.ilga.gov/Legislation/ILCS/Articles?ActID=4001&ChapterID=61
Title: Illinois Compiled Statutes Chapter 760, Trusts and Fiduciaries (showing the Trusts and Trustees Act, 760 ILCS 5/, repealed by P.A. 101-48). Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Not listed. URL: https://www.ilga.gov/Legislation/ILCS/Acts?ChapterID=61
Title: 755 ILCS 5/18-10 and 5/18-13, Classification of claims against decedent's estate and priority of payment (Probate Act of 1975, Article XVIII). Publisher: Illinois General Assembly, Illinois Compiled Statutes. Publication Date: Not listed. URL: https://www.ilga.gov/Legislation/ILCS/details?ActID=2104&ChapterID=60&SeqStart=23200000&SeqEnd=24900000
Title: Important Notice Regarding Illinois Estate Tax and Fact Sheet ($4,000,000 exclusion, no portability, filing with the Attorney General). Publisher: Office of the Illinois Attorney General. Publication Date: Not listed. URL: https://illinoisattorneygeneral.gov/Page-Attachments/EstateTaxInstructionFactSheet.pdf
Title: Unclaimed Property (I-CASH), the state administrator a trustee must search before terminating a trust under 760 ILCS 3/810(f). Publisher: Office of the Illinois State Treasurer. Publication Date: Not listed. URL: https://icash.illinoistreasurer.gov/

It is not legal advice.