Annual Trust Accounting Requirements in Colorado

At a glance

Requirements one by one

Current distributees receive reports automatically

C.R.S. § 15-5-813(1)-(6), including subsection (3)(a), requires a trustee's report at least annually and at trust termination. Distributees and permissible distributees of income or principal receive it automatically. Other qualified beneficiaries receive it when they request it.

Section 15-5-103(16) defines qualified beneficiaries through three distribution horizons: people eligible now, people who would become eligible if current interests ended without terminating the trust, and people who would become eligible if the trust terminated.

The recurring report has a short statutory content list

The annual and termination report covers trust property, liabilities, receipts, and disbursements. It identifies the source and amount of trustee compensation, lists the trust assets, and supplies their respective market values when feasible.

The statute does not prescribe carrying value, separate principal-and-income allocations, agent-compensation schedules, a reconciliation, a trustee signature, verification, oath, or notarization. Those items may be useful in a particular administration, but they are not minimum § 15-5-813(3)(a) contents.

A vacancy reaches all qualified beneficiaries

Under § 15-5-813(3)(b), a vacancy with no cotrustee remaining requires the former trustee to send a report to the qualified beneficiaries. A personal representative, conservator, or guardian may send it for a deceased or incapacitated trustee. The vacancy paragraph does not separately restate the report's financial contents.

Revocability, trust terms, and older events require separate treatment

To the extent a trust is revocable, § 15-5-603(1)-(3) makes beneficiary rights subject to the settlor's control and makes trustee duties exclusive to the settlor. Trust terms otherwise generally control under § 15-5-105(1).

For an irrevocable trust, however, § 15-5-105(2)(i) protects a qualified beneficiary's right to request trustee reports and other administration information. The automatic recurring-report rule is not separately listed among the mandatory provisions, so the trust terms and any preserved request right must be read together.

The January 1, 2019 exceptions in § 15-5-813(5) name only subsections (2)(b) and (2)(c), the initial acceptance and irrevocability notices. They do not state an exception to subsection (3)'s report duties.

A qualified beneficiary may waive reports or other information and later withdraw the waiver for future reports under § 15-5-813(4). No writing requirement is stated.

Delivery and legal effect are separate questions

C.R.S. § 15-5-109(1)-(4) requires a sending method reasonably suitable under the circumstances and likely to result in receipt. It lists first-class mail, personal delivery, delivery to the last-known residence or business, and a properly directed electronic message. The statute does not require routine court filing or certified mail.

Receipt alone does not approve every transaction or release the trustee. Under § 15-5-1005(1)-(5), a report starts the one-year breach-of-trust period only if it adequately discloses a potential claim and informs the beneficiary of the time allowed to commence a proceeding. Adequate disclosure means enough information that the beneficiary or representative knows of the potential claim or should have inquired.

If the one-year rule does not apply, the period is three years from the first of trustee removal or resignation, termination of the beneficiary's interest, or trust termination. Section 15-5-1005 does not preclude an action for fraud or misrepresentation related to the report.

Approval, release, and remedies require an additional legal step

C.R.S. § 15-5-111(1)-(5) permits a nonjudicial settlement agreement that does not violate a material trust purpose and contains only terms a court could properly approve. The listed subjects include approval of a trustee's report or accounting and trustee liability.

A beneficiary's consent, release, or ratification may protect the trustee under § 15-5-1009, but not when trustee misconduct induced it or the beneficiary lacked knowledge of the beneficiary's rights or material breach facts.

For a reporting breach, § 15-5-1001(1)-(3) allows the court to compel performance or an accounting, status report, financial report, or inventory; enjoin or redress breach; surcharge or sanction; suspend or remove the trustee; deny or disgorge compensation; trace property; or grant other appropriate relief. C.R.S. § 15-5-1004 directs trustee, attorney, and third-party compensation and costs to Title 15, article 10, part 6 rather than stating an accounting-specific automatic fee or penalty.

What trips people up

The one-year period does not start merely because an annual report was mailed. The report must adequately disclose a potential claim and tell the beneficiary the time allowed to commence a proceeding under § 15-5-1005(1).

Common questions

Does every qualified beneficiary receive the annual report automatically?

No. Current distributees and permissible distributees receive it. Other qualified beneficiaries receive it when they request it.

Must every asset have a market value?

The report lists respective market values only when feasible. Section 15-5-813 does not prescribe an appraisal method.

Is the vacancy report the same as a court-approved account?

No. It is a statutory report sent by the former trustee. Court relief or a binding nonjudicial settlement is a separate route.

Statutes and sources

• C.R.S. §§ 15-5-103(16), 15-5-105, 15-5-109, 15-5-111, 15-5-603, 15-5-813, 15-5-1001, 15-5-1004, 15-5-1005, and 15-5-1009, official Colorado Revised Statutes Title 15, accessed 2026-08-10: https://olls.info/crs/crs2025-title-15.pdf