Annual Trust Accounting Requirements in South Carolina

At a glance

Requirements one by one

The recurring report is automatic but trust-variable

S.C. Code § 62-7-813(a)-(e) requires a covered trustee to send a written report annually and at trust termination unless the trust terms expressly provide otherwise. Distributees and permissible distributees receive it automatically. Other qualified beneficiaries receive it after requesting information in writing.

S.C. Code § 62-7-103(12) and subsections (21) and (25) distinguish those classes. A qualified beneficiary is a living beneficiary within the current, next-line, or termination distribution horizons. A distributee has received trust property, while a permissible distributee is currently eligible to receive it.

The statutory content standard is flexible

The report may use any format that gives recipients the information necessary to protect their interests. Section 62-7-813(c)(1)(B) says it may include a fiduciary income tax return, bank or brokerage statements, or an informal list of assets and feasible market values, liabilities, receipts, disbursements, and trustee-compensation source and amount.

“May include” matters here. The statute does not make each example a mandatory schedule or require carrying values, principal-and-income allocations, agent compensation, a reconciliation, a signature, an oath, or notarization.

Resignation has a narrower recipient and cotrustee rule

Under § 62-7-813(c)(2), a resigning trustee sends the same described written report to distributees and permissible distributees only when no cotrustee remains. If the trustee dies or becomes incapacitated, a personal representative, conservator, or guardian may send the report. The statute does not label every interim change or successor's assumption as an independent accounting trigger.

Coverage begins with the article's effective-date events

Section 62-7-813(c) covers a trustee who accepts or undertakes administration of an irrevocable trust created on or after the article's effective date, or of a formerly revocable trust that becomes irrevocable on or after that date. Official 2005 S.C. Act No. 66 § 9 set the date at January 1, 2006. The formal citation is 2005 S.C. Act No. 66 § 9.

“SECTION 9. This act takes effect on January 1, 2006.”

The general default rule in § 62-7-105(a)-(b) lets the trust terms control the reporting provisions. The transition rule in § 62-7-1106(a)-(b) reaches trusts created before, on, or after the effective date, but preserves pre-effective acts, accrued rights, and already-running limitation periods. The specific event language in § 62-7-813(c) still controls this report duty.

While a trust is revocable, § 62-7-603 and § 62-7-813(a) direct beneficiary rights and these duties exclusively to the settlor unless the trust terms provide otherwise.

Delivery, waiver, and representation remain separate

S.C. Code § 62-7-109(a)-(c) requires a 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 out-of-court report does not require certified mail, routine court filing, or a proof-of-service package.

A distributee or permissible distributee may waive reports and information and later withdraw the waiver for future periods under § 62-7-813(e). If there is no conflict of interest, delivery to a statutory beneficiary representative satisfies the information and report duties. Attorney-client privilege remains protected.

A report may limit claims without approving the account

Under § 62-7-1005(a)-(c), a report that adequately discloses a potential breach-of-trust claim starts a one-year period when sent to the beneficiary or representative. Adequate disclosure means enough information that the recipient knows of the potential claim or should have inquired. The section does not require a separate limitations warning.

If the one-year rule does not apply, the period is three years from the first of trustee removal, resignation, or death; termination of the beneficiary's interest; or trust termination. Mere receipt still is not approval or release of every act.

Interested persons may use § 62-7-111(a)-(c) for a binding nonjudicial settlement limited to the listed matters, including approval of a report or accounting and trustee liability. Under § 62-7-1009(a)-(b), consent, release, or ratification does not protect a trustee when induced by improper conduct or given without knowledge of the beneficiary's rights or material breach facts.

Courts have express accounting and fee remedies

S.C. Code § 62-7-1001(a)-(b) permits a court to compel performance or an account, enjoin or redress breach, appoint a special fiduciary, suspend or remove the trustee, reduce or deny compensation, trace property, or grant other appropriate relief. Under § 62-7-1004, the court may award costs and reasonable attorney's fees as justice and equity require, payable by another party or from the trust.

What trips people up

The example financial materials are not a fixed checklist. The controlling standard is a format that gives recipients the information necessary to protect their interests; tax returns, account statements, and an informal financial list are expressly things the report “may include.”

Common questions

Does every qualified beneficiary automatically receive the report?

No. Distributees and permissible distributees do. Another qualified beneficiary must request information in writing.

Must every report contain appraised market values?

No. Market values are one permissive example and are qualified by “if feasible.” The statute leaves the report format flexible.

Does silence after a report release the trustee?

The statute states no automatic release by silence. Adequate disclosure may start the one-year limitation period, while approval, settlement, consent, or release requires a separate legal basis.

Statutes and sources

• S.C. Code §§ 62-7-103, 62-7-105, 62-7-109, 62-7-111, 62-7-603, 62-7-813, 62-7-1001, 62-7-1004, 62-7-1005, 62-7-1009, and 62-7-1106, official South Carolina Trust Code, accessed 2026-08-10: https://www.scstatehouse.gov/code/t62c007.php
• 2005 S.C. Act No. 66 § 9, official enrolled bill page, accessed 2026-08-10: https://www.scstatehouse.gov/sess116_2005-2006/bills/422.htm