[WSBAPT] trustee's discretion with respect to charitable trust

[Philip N. Jones]

I vote with Diane.  It’s a tough problem, particularly with the charitable deduction.  If you prohibit the trustee from selling to Joe Slimeball, the trustee might end up selling the property for less.  On the other hand, it seems unlikely that Joe is the only person willing to pay FMV.  Perhaps you should include a sentence expressing a precatory view that the trustor prefers that the property not be sold to Joe, as long as that can be accomplished without reducing the selling price below FMV.  Of course, the trustee will probably want to get an appraisal in any event.
But what if Joe offers the highest price, and the trustee sells to Bidder #2 for less?  I would think that you still get a charitable deduction for the amount that actually passes to charity.
Phil Jones

Philip N. Jones
Duffy Kekel LLP
900 S.W. Fifth Ave. Suite 2500
Portland, OR 97204
pjones at duffykekel.com<mailto:pjones at duffykekel.com>
(503) 226-1371 – office
(503) 853-1482 – cell
(503) 226-3574 - fax

From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> On Behalf Of Diane J. Kiepe
Sent: Friday, August 19, 2022 12:52 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: Re: [WSBAPT] trustee's discretion with respect to charitable trust

Cy,

That’s a tough one.  As we all know the court does not like unreasonable restraints and restrictions.  I’ll be curious to hear other folks responses.  I’m drawing a blank.

Diane J. Kiepe

Diane J. Kiepe
Douglas Eden
717 W. Sprague Ave.
Suite 1500
Spokane, WA  99201
djkiepe at depdslaw.com<mailto:djkiepe at depdslaw.com>
509-455-5300

From: wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com> <wsbapt-bounces at lists.wsbarppt.com<mailto:wsbapt-bounces at lists.wsbarppt.com>> On Behalf Of cyfield at rockisland.com<mailto:cyfield at rockisland.com>
Sent: Friday, August 19, 2022 11:17 AM
To: 'WSBA Probate & Trust Listserv' <wsbapt at lists.wsbarppt.com<mailto:wsbapt at lists.wsbarppt.com>>
Subject: Re: [WSBAPT] trustee's discretion with respect to charitable trust

Folks- I have a client with a taxable estate where most of her assets are in a trust that at her passing are sold and the proceeds pass to various charities. She has recently been approached by someone she doesn’t care for who wants to buy her property. She said no but now she is concerned that her successor trustee might be pressured to sell to this individual should they later make the best offer. Client wonders what potential direction or discretion she can give the trustee in selling the property?

While normally not a problem, I’m concerned that if we give the trustee too much discretion it might somehow foul up the charitable deduction but if we don’t then trustee might be forced to accept highest offer from unsavory individual as part of his fiduciary duty to beneficiaries.  TIA for any thoughts/insight, Cy

Cyrus W. Field, Attorney at Law (admitted in Washington and Oregon); Phone: 360-472-1223
Mail: POB 367, Shaw Island, WA 98286; Physical Office:  640 Mullis St #214, Friday Harbor, WA
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