Distributions · 6 min read
How discretion is judged
R.C. 5808.14(A) provides that a trustee exercises a discretionary power reasonably, in good faith and in accordance with the terms and purposes of the trust and the interests of the beneficiaries — the greater the settlor's grant of discretion, the broader the range of permissible conduct — except that no reasonableness standard applies to the distribution decisions of the trustee of a wholly discretionary trust (R.C. 5801.01(Y)). Unless the terms expressly say otherwise, a beneficiary-trustee may distribute for the trustee's own benefit only under an ascertainable standard, and no trustee may distribute to satisfy a support obligation the trustee personally owes (R.C. 5808.14(B)).
Timing: the contest period, the reserve and the proposal
After the settlor's death the trustee may distribute under the terms without liability unless it has actual knowledge of a pending contest, or a potential contestant's written notification is followed by a filing within ninety days; a contest is commenced by the earlier of two years after the death or six months after the trustee sends the person the instrument and a notice (R.C. 5806.04). On a termination the trustee proceeds expeditiously to distribute, subject to a reasonable reserve for debts, expenses and taxes, and may send a proposal for distribution that ends a beneficiary's objection after thirty days where it states the right to object (R.C. 5808.17(A), (B)).
A deceased beneficiary's share goes to the personal representative of an open estate or, on the statute's conditions, directly to the heirs or devisees (R.C. 5808.17(D)). Where the trust holds less than $100,000 and its value does not justify the cost of administration, the trustee may terminate it after notice to the qualified beneficiaries (R.C. 5804.14).
What "per stirpes" means in Ohio
Under Ohio's statute of descent and distribution, the children of an intestate or their lineal descendants take per stirpes — by branches, each surviving child taking a share and a deceased child's share passing to that child's own descendants (R.C. 2105.06(A)); where all the descendants are of an equal degree of consanguinity, they take in equal parts (R.C. 2105.12). For a future interest under a trust that became irrevocable on or after March 22, 2012, "per stirpes" means that a deceased beneficiary's descendants take the shares they would have taken under R.C. 2105.06(A), and a beneficiary who does not survive the distribution date by 120 hours is treated as having predeceased (R.C. 5808.19). The trust's own words decide which rule applies; the distribution calculator models the arithmetic.
The statutes, verbatim
Statute of descent and distribution
R.C. 2105.06 ↗Clear, simple explanation; the verbatim statute text is not yet attested in our library. See the official statute via the link above.
Actions concerning certain revocable trusts
R.C. 5806.04 ↗Clear, simple explanation; the verbatim statute text is not yet attested in our library. See the official statute via the link above.
Judicial standard of review for discretionary trusts
R.C. 5808.14 ↗Clear, simple explanation; the verbatim statute text is not yet attested in our library. See the official statute via the link above.
Powers and duties of trustee on termination; protection from liability
R.C. 5808.17 ↗Clear, simple explanation; the verbatim statute text is not yet attested in our library. See the official statute via the link above.
Common questions
Can an Ohio trustee distribute right after the settlor's death?
The trustee may distribute under the terms without liability unless it has actual knowledge of a pending contest, or a potential contestant's written notification is followed by a filing within ninety days (R.C. 5806.04(B)); a beneficiary returns any excess if the trust is later held invalid (R.C. 5806.04(C)). The estate's creditors present claims within six months of the death (R.C. 2117.06).
What does "per stirpes" mean in Ohio?
A division by branches beginning at the children's generation: a deceased child's share passes to that child's descendants (R.C. 2105.06(A)); descendants of equal degree take equally (R.C. 2105.12). The same rule fixes a deceased trust beneficiary's descendants' shares (R.C. 5808.19(A)(7)).
May an Ohio trustee keep a reserve before distributing?
Yes. On a terminating event the trustee distributes expeditiously, subject to the right to retain a reasonable reserve for the payment of debts, expenses and taxes (R.C. 5808.17(B)).
Related reading
The Learning Center is general information about Ohio law — not legal advice, and not a substitute for advice from a licensed Ohio attorney about your specific facts. TrusteeClear is software, not a law firm.
Frequently asked questions
- Can an Ohio trustee distribute right after the settlor's death?
- The trustee may distribute under the terms without liability unless it has actual knowledge of a pending contest, or a potential contestant's written notification is followed by a filing within ninety days (R.C. 5806.04(B)); a beneficiary returns any excess if the trust is later held invalid (R.C. 5806.04(C)). The estate's creditors present claims within six months of the death (R.C. 2117.06).
- What does "per stirpes" mean in Ohio?
- A division by branches beginning at the children's generation: a deceased child's share passes to that child's descendants (R.C. 2105.06(A)); descendants of equal degree take equally (R.C. 2105.12). The same rule fixes a deceased trust beneficiary's descendants' shares (R.C. 5808.19(A)(7)).
- May an Ohio trustee keep a reserve before distributing?
- Yes. On a terminating event the trustee distributes expeditiously, subject to the right to retain a reasonable reserve for the payment of debts, expenses and taxes (R.C. 5808.17(B)).
General information about Ohio law, not legal advice.