Backdating allocation of marital assets into survivor trust

If a couple is extremely wealthy and establishes an A/B Trust, then at the death of the deceased spouse, the applicable exclusion amount will be held in the Bypass Trust, but the balance of the couple’s estate will be held exclusively by the surviving spouse in the Survivor’s Trust.

In 2017, in an estate of million, .49 million would be held in the Bypass Trust and .51 million in the Survivor’s Trust.

The A Trust (known as the "Survivor's Trust") contains the balance of the couple's assets.

The surviving spouse may use the funds in the Survivor's Trust without restrictions and retains the right to amend the Survivor’s Trust at any time.

The surviving spouse is often the Trustee and must be the only beneficiary of the new QTIP Trust.

If a couple with a large estate has children from earlier marriages or do not agree on the distributions to their ultimate beneficiaries, the A/B/QTIP Trust is preferable to the simpler A/B Trust option.

In the A/B/QTIP Trust, regardless of the size of the couple’s estate, the husband may leave his estate to one group of heirs after the death of the surviving spouse and the wife may leave her estate to other heirs.

The type of living trust a couple selects is now driven by a desire for control, perhaps due to blended families or differences in wealth.

Please keep in mind that there are other considerations, such as retirement planning, income tax, and capital gains tax, which are not addressed on this website.

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