The phrase "credit shelter trust" trust refers to a trust that is designed to make maximum use of the unified credit for estate taxes -- which is also known as the lifetime exemption. Each individual is allowed a once-in-a-lifetime exemption from estate and gift taxes. However, the exemption is computed as a credit against the estate and gift tax that is sufficient to offset the tax on an estate of a specified size. A credit shelter trust is designed to make maximum use of the unified credit for estate taxes. Each individual is allowed a once-in-a-lifetime credit from estate and gift taxes. For 2009 the exempt amount is 3.5 million. By the year 2010 the inheritance tax is eliminated but if congress does not make the elimination permanent in the following year the tax will return and the exempt amount will be $1.0 million. Since it is any one's guess what congress will do, planning to maximize the credit is still the smartest estate plan for married couples to utilize.
The parties must split there assets so that roughly 1/2 half of the assets are held by Spouse One and 1/2 of the assets are held by Spouse Two. Each spouse then provides by will or living trust that upon their death the amount of their assets up to the exemption amount are to be held in a trust known as the credit shelter trust. The trust typically provides that the surviving spouse has entitlement to the income and to the principal provided that there are "ascertainable standards" established in accordance with IRS law for the trustee to distribute principal to the surviving spouse.
When the first spouse dies the credit shelter trust is exempt from tax. When the surviving spouse dies the surviving spouse's estate up to the exempt amount is also exempt from tax. This way the parties can exempt twice as much of their combined estates from taxation and save their loved ones substantial tax savings without losing beneficial use and enjoyment of their assets during their lifetimes.
The Amarillo Married Person's Will for the State of Texas with Children With a Credit Shelter Trust for Spouse and a Trust for Children — Marital Trust is a legal document designed to protect the assets and ensure the financial security of a married person residing in Amarillo, Texas. This will is specifically tailored for couples with children and includes provisions for asset distribution through a Credit Shelter Trust for the spouse and a separate Trust for the children. The Credit Shelter Trust, also known as a bypass trust, is an essential component of this will. It allows the deceased spouse's assets to pass to the trust upon their death, ensuring that the assets are protected for the surviving spouse and potentially qualifying for estate tax exemptions. This trust provides financial support to the surviving spouse while preserving the principal for the benefit of the children. The Trust for Children, also referred to as a contingent trust, is established to safeguard the inheritance for minor children or other beneficiaries who are not yet of legal age. This trust is administered by a trustee, who manages the assets on behalf of the children until they reach a designated age or milestone determined by the testator. The Amarillo Married Person's Will for the State of Texas with Children With a Credit Shelter Trust for Spouse and a Trust for Children — Marital Trust includes various key provisions and legal terms important to protect the interests of the testator and their family. Some relevant keywords that may be associated with this will include: 1. Estate Planning: This will is an essential component of comprehensive estate planning, ensuring that the testator's wishes are legally documented and followed upon their death. 2. Asset Protection: The use of the Credit Shelter Trust and the Trust for Children assists in protecting the assets from potential creditors or future estate taxes. 3. Survivorship Benefits: The surviving spouse is provided with financial security through the Credit Shelter Trust while ensuring the children receive their rightful inheritance. 4. Testamentary Trust: The Trust for Children is a testamentary trust, meaning it has its foundation within the provisions of the deceased's will and becomes effective upon their death. 5. Guardianship: The will can also designate a guardian for minor children who will be responsible for their care and assets until they reach adulthood or the designated age in the trust. 6. Beneficiaries: The will specifies the beneficiaries of the trusts and any provisions for the distribution of assets among them. 7. Trustee: The will designates a trustee who will manage and distribute the assets within the trusts according to the testator's instructions. It is important to consult with a qualified attorney who specializes in estate planning to draft and customize an Amarillo Married Person's Will for the State of Texas with Children With a Credit Shelter Trust for Spouse and a Trust for Children — Marital Trust to meet individual circumstances and legal requirements.The Amarillo Married Person's Will for the State of Texas with Children With a Credit Shelter Trust for Spouse and a Trust for Children — Marital Trust is a legal document designed to protect the assets and ensure the financial security of a married person residing in Amarillo, Texas. This will is specifically tailored for couples with children and includes provisions for asset distribution through a Credit Shelter Trust for the spouse and a separate Trust for the children. The Credit Shelter Trust, also known as a bypass trust, is an essential component of this will. It allows the deceased spouse's assets to pass to the trust upon their death, ensuring that the assets are protected for the surviving spouse and potentially qualifying for estate tax exemptions. This trust provides financial support to the surviving spouse while preserving the principal for the benefit of the children. The Trust for Children, also referred to as a contingent trust, is established to safeguard the inheritance for minor children or other beneficiaries who are not yet of legal age. This trust is administered by a trustee, who manages the assets on behalf of the children until they reach a designated age or milestone determined by the testator. The Amarillo Married Person's Will for the State of Texas with Children With a Credit Shelter Trust for Spouse and a Trust for Children — Marital Trust includes various key provisions and legal terms important to protect the interests of the testator and their family. Some relevant keywords that may be associated with this will include: 1. Estate Planning: This will is an essential component of comprehensive estate planning, ensuring that the testator's wishes are legally documented and followed upon their death. 2. Asset Protection: The use of the Credit Shelter Trust and the Trust for Children assists in protecting the assets from potential creditors or future estate taxes. 3. Survivorship Benefits: The surviving spouse is provided with financial security through the Credit Shelter Trust while ensuring the children receive their rightful inheritance. 4. Testamentary Trust: The Trust for Children is a testamentary trust, meaning it has its foundation within the provisions of the deceased's will and becomes effective upon their death. 5. Guardianship: The will can also designate a guardian for minor children who will be responsible for their care and assets until they reach adulthood or the designated age in the trust. 6. Beneficiaries: The will specifies the beneficiaries of the trusts and any provisions for the distribution of assets among them. 7. Trustee: The will designates a trustee who will manage and distribute the assets within the trusts according to the testator's instructions. It is important to consult with a qualified attorney who specializes in estate planning to draft and customize an Amarillo Married Person's Will for the State of Texas with Children With a Credit Shelter Trust for Spouse and a Trust for Children — Marital Trust to meet individual circumstances and legal requirements.
Para su conveniencia, debajo del texto en español le brindamos la versión completa de este formulario en inglés. For your convenience, the complete English version of this form is attached below the Spanish version.
