Nebraska Co-Trustees: A Seemingly Simple Choice That Can Lead to Serious Trouble
Naming your adult child as a co-trustee of your trust might seem like a practical, low-risk way to prepare for the future. But in many cases, it opens the door to confusion, liability, and even trust litigation—especially here in Nebraska, where co-trustees share very real legal responsibilities under the law.
Let’s look at how a well-intentioned estate planning decision can turn into an expensive and emotionally charged legal issue—and what you can do instead.
The Common Scenario: “Just in Case” Turns Into “Why Me?”
Here’s what often happens:
A parent sets up a revocable living trust and decides to name their adult child as a co-trustee—not because they need help right now, but “just in case something happens.” They want the transition to be seamless later. The child agrees. It seems harmless.
But in practice, nothing changes. The parent keeps managing everything—bank accounts, investments, distributions, taxes. The child stays in the background, maybe unaware they even have a role to play. There’s no shared decision-making, no documentation, and no accountability process.
Years pass. The parent dies. The trust becomes irrevocable. The beneficiaries—often other siblings—start asking questions:
“Why were these accounts closed?”
“What happened to the proceeds from the home sale?”
“Where’s the accounting from the last few years?”
They expect the co-trustee to answer.
But the co-trustee doesn’t have answers—because they were never actually involved.
Nebraska Trust Law: Co-Trustees Share Legal Responsibility
Under the Nebraska Uniform Trust Code, co-trustees aren’t symbolic figures. They have active, ongoing fiduciary duties, even if only one person is handling the day-to-day administration.
Nebraska Revised Statute §30-3859 (UTC 703)(g) says it clearly: every trustee must “exercise reasonable care to prevent a cotrustee from committing a serious breach of trust” and “compel a cotrustee to redress a serious breach of trust.”
In plain English? If your name is on the trust as co-trustee, you’re legally responsible—even if you weren’t involved.
This is where things often go sideways. When there’s a lack of communication, recordkeeping, or understanding of the role, co-trustees become vulnerable to accusations of mismanagement, neglect, or worse. And once the trust is irrevocable, beneficiaries have the right to request information, an accounting, and answers. (See Neb. Rev. Stat. §30-3878 (UTC 813).)
When a co-trustee can’t provide them, they may end up in court trying to prove they didn’t do anything wrong.
Litigation Risks: When Co-Trustees Don’t—or Can’t—Explain
One of the most common catalysts for trust litigation in Nebraska is lack of clarity or missing documentation. It’s rarely about theft or malice. More often, it’s about:
No records of financial decisions,
No communication between co-trustees,
No proof that distributions were fair or authorized,
No ability to answer questions from other beneficiaries.
And when siblings feel shut out or start to suspect mismanagement—even unfairly—it doesn’t take much to escalate into formal disputes.
Even if you “did nothing wrong,” if you can’t explain what happened with the trust, you may still have to defend yourself.
A Smarter Structure: Successor Trustee > Co-Trustee
In many situations, a better solution is naming your child as a successor trustee—someone who steps in only when you can no longer serve, due to incapacity or death.
This preserves your independence while still preparing for transition. It also creates a clear timeline and triggers for responsibility, backed by documentation.
If you do want your child involved sooner—for help or learning purposes—it’s essential that:
1. Both trustees actively manage the trust together
That includes reviewing statements, making decisions jointly, and signing documents as co-trustees.
2. You maintain clear records and communication
Keep meeting notes, email confirmations, and transaction logs. Even a shared spreadsheet or Google Drive can go a long way.
3. You understand the legal duty involved
Co-trustees in Nebraska are held to the highest fiduciary standards—duty of loyalty, duty of care, duty to inform and report. This isn’t a ceremonial title. It’s a legal obligation.
Key Takeaways
Co-trustees in Nebraska are legally responsible for the trust—even if they weren’t actively involved.
Lack of documentation and communication can trigger disputes among family members and lead to expensive litigation.
Naming a successor trustee is often a safer, more effective approach unless shared management is truly necessary.
If you do name a co-trustee, be intentional: treat it like a business partnership with clear records and expectations.
FAQs: Nebraska Co-Trustees and Trust Planning
Q: Can I name my child as co-trustee to avoid probate?
A: Not necessarily. Trusts already avoid probate. A successor trustee can take over at your death without court involvement, so naming a co-trustee doesn’t add value in most cases.
Q: Can a co-trustee be removed in Nebraska?
A: Yes, if they’re not fulfilling their fiduciary duties or if the trust document allows for removal. It often requires court involvement.
Q: What’s the downside of a successor trustee instead?
A: Successor trusteeship delays involvement until needed—but that’s usually a benefit. It avoids confusion and legal risk during your lifetime.
Protect Yourself—and Your Family—from Unnecessary Risk
Estate planning is supposed to make things easier, not harder. Naming a co-trustee may feel like the right move in the moment—but unless it’s done with intention and structure, it can create more headaches than it solves.
If you’re considering naming a child or family member as a co-trustee in Nebraska—or you want help reviewing your current trust—I can walk you through the pros, cons, and better alternatives.