Vermont adopted the Uniform Trust Code in 2009, providing a modern framework for trust administration. Vermont made one especially notable modification: it treated the UTC's duty to inform and report (Section 813) as entirely a default rule rather than a mandatory one. This gives trust creators more flexibility to control what information beneficiaries receive than in most other UTC states. The Vermont Trust Code is found at 14 V.S.A. Title 14A, Sections 101 and following.
This guide applies to both revocable and irrevocable trusts in Vermont.
Where Vermont trust law lives
Vermont's trust statutes are codified in 14 V.S.A. Title 14A. The code follows the standard UTC structure. Vermont's approach to mandatory versus default rules, particularly around the duty to inform, is the key distinction from other UTC states.
Accounting and notice requirements
Vermont's approach to reporting is more flexible than most UTC states. By omitting Section 813 from its list of mandatory rules (under 14A V.S.A. Section 105), Vermont made the entire duty-to-inform framework a default rule. This means the trust instrument can modify, restrict, or eliminate the trustee's obligation to notify beneficiaries and provide annual accountings.
For trusts that do not modify the default rules, the standard UTC framework applies: 60-day notice to qualified beneficiaries upon accepting trusteeship, and annual accounting.
While the trust is revocable and the trust creator is alive and competent, the trustee's duties run primarily to the trust creator.
Trustee duties
Vermont trustees must administer the trust in good faith, following the trust's terms and purposes, and in the interests of the beneficiaries. All standard UTC duties apply: loyalty, impartiality, prudent administration, and prudent investing. Compensation follows the trust instrument first, with reasonable compensation as the default.
What makes Vermont different
Reporting as a default rule. Vermont's treatment of the duty to inform as entirely a default rule is the most flexible approach in the Northeast region. This effectively creates quiet trust capability without requiring a separate quiet trust statute. The trust creator can draft the trust instrument to restrict or eliminate beneficiary information rights, giving Vermont a practical advantage for families who want privacy around trust details.
No state estate tax or inheritance tax. Vermont does not impose a state estate tax or inheritance tax. Only the federal estate tax applies to estates exceeding the federal exemption threshold.
Standard UTC modification tools. Vermont provides the full suite of UTC modification options: nonjudicial settlement agreements, court modification for changed circumstances, and modification by consent.
Small, accessible court system. Vermont's probate courts handle trust matters, and the state's smaller size means a generally more accessible and less congested court system than neighboring states like Massachusetts or Connecticut.
TrustHelm tip: Vermont's flexible reporting rules mean your trust instrument has more control over beneficiary information rights than in most states. TrustHelm's AI-powered document analysis can help you understand exactly what your Vermont trust says about reporting obligations and whether the default UTC rules have been modified.
The most common Vermont trust mistakes
Not funding the trust. As in every state, the most common mistake is failing to transfer assets into the trust.
Not understanding whether default rules have been modified. Vermont's flexibility means two trusts in the same state can have very different reporting obligations depending on what the trust instrument says. If you are a beneficiary, you need to know whether the trust has modified the default rules.
Missing the 60-day notice deadline (when it applies). For trusts that follow the default UTC rules, the 60-day notice requirement still applies. Trustees should determine which rules apply to their specific trust before assuming they have more flexibility.
Not providing accountings even when not required. Even if the trust instrument eliminates mandatory reporting, voluntary accountings still protect the trustee by starting the statute of limitations clock. A trustee who never provides reports remains exposed to claims indefinitely.
When to talk to an attorney
You should consult a Vermont trust attorney if you need to understand whether your trust has modified the default reporting rules, if you are a beneficiary trying to determine your information rights, if you need to modify a trust, or if you have been named as trustee and want to understand your obligations.
If you need help finding a qualified estate planning attorney in your area, visit TrustHelm's Find an Attorney tool.
This guide is for educational purposes only and does not constitute legal advice. Consult a qualified attorney for decisions about your trust.