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 Beaumont Married Person's Will for the State of Texas with Children is a comprehensive legal document that provides detailed instructions for a married individual residing in Beaumont, Texas, who has children. This will incorporates specific provisions for a Credit Shelter Trust for the surviving spouse and a separate Trust for the children, commonly known as the Marital Trust. Keywords: Beaumont, Married Person's Will, State of Texas, Children, Credit Shelter Trust, Spouse, Trust, Marital Trust. 1. Overview: The Beaumont Married Person's Will for the State of Texas with Children is a legally binding document that outlines the distribution of assets, property, and the care of minor children upon the death of the testator (person creating the will). It is specifically designed for married individuals residing in Beaumont, Texas, who have children. 2. Credit Shelter Trust: The Credit Shelter Trust is a significant component of this will. It ensures that upon the death of the first spouse, a predetermined amount of assets will be placed in a trust to benefit the surviving spouse while minimizing estate taxes. The surviving spouse can utilize the income from this trust during their lifetime, and upon their death, the remaining assets will pass onto the children. 3. Trust for Children: The Beaumont Married Person's Will also establishes a separate Trust for the care and well-being of the children. This trust ensures that the children's needs, including education, healthcare, and maintenance, will be provided for after the death of both parents. 4. Marital Trust: The Marital Trust, also referred to as the A-Trust, TIP Trust, or Lifetime Trust, is a specific type of trust created for the surviving spouse. This trust allows the surviving spouse to benefit from the income generated by the trust assets during their lifetime, while still maintaining control over the ultimate distribution of the assets to the children. 5. Irrevocable and Revocable Trusts: The Beaumont Married Person's Will may include options for both irrevocable and revocable trusts. An irrevocable trust, once established, cannot be modified or revoked, providing long-term asset protection and tax benefits. In contrast, a revocable trust allows the testator to make changes or revoke the trust during their lifetime. 6. Guardianship Provisions: In addition to the establishment of the trusts, this will also allow the testator to name guardians for minor children. These provisions ensure that the children will be cared for by trusted individuals in the event that both parents pass away. 7. Estate Tax Planning: The Beaumont Married Person's Will with Children is designed to assist with estate tax planning by utilizing various strategies, including the inclusion of the Credit Shelter Trust and Marital Trust. These provisions aim to minimize or eliminate estate taxes, allowing for a more efficient transfer of assets to the spouse and children. 8. Legal Assistance: Given the complexity and legal implications involved in drafting a Beaumont Married Person's Will with Children, it is strongly recommended seeking professional legal assistance to ensure that the document accurately reflects personal intentions and adheres to relevant Texas laws and regulations. Consulting an experienced estate planning attorney can provide peace of mind and ensure the proper execution of one's final wishes.The Beaumont Married Person's Will for the State of Texas with Children is a comprehensive legal document that provides detailed instructions for a married individual residing in Beaumont, Texas, who has children. This will incorporates specific provisions for a Credit Shelter Trust for the surviving spouse and a separate Trust for the children, commonly known as the Marital Trust. Keywords: Beaumont, Married Person's Will, State of Texas, Children, Credit Shelter Trust, Spouse, Trust, Marital Trust. 1. Overview: The Beaumont Married Person's Will for the State of Texas with Children is a legally binding document that outlines the distribution of assets, property, and the care of minor children upon the death of the testator (person creating the will). It is specifically designed for married individuals residing in Beaumont, Texas, who have children. 2. Credit Shelter Trust: The Credit Shelter Trust is a significant component of this will. It ensures that upon the death of the first spouse, a predetermined amount of assets will be placed in a trust to benefit the surviving spouse while minimizing estate taxes. The surviving spouse can utilize the income from this trust during their lifetime, and upon their death, the remaining assets will pass onto the children. 3. Trust for Children: The Beaumont Married Person's Will also establishes a separate Trust for the care and well-being of the children. This trust ensures that the children's needs, including education, healthcare, and maintenance, will be provided for after the death of both parents. 4. Marital Trust: The Marital Trust, also referred to as the A-Trust, TIP Trust, or Lifetime Trust, is a specific type of trust created for the surviving spouse. This trust allows the surviving spouse to benefit from the income generated by the trust assets during their lifetime, while still maintaining control over the ultimate distribution of the assets to the children. 5. Irrevocable and Revocable Trusts: The Beaumont Married Person's Will may include options for both irrevocable and revocable trusts. An irrevocable trust, once established, cannot be modified or revoked, providing long-term asset protection and tax benefits. In contrast, a revocable trust allows the testator to make changes or revoke the trust during their lifetime. 6. Guardianship Provisions: In addition to the establishment of the trusts, this will also allow the testator to name guardians for minor children. These provisions ensure that the children will be cared for by trusted individuals in the event that both parents pass away. 7. Estate Tax Planning: The Beaumont Married Person's Will with Children is designed to assist with estate tax planning by utilizing various strategies, including the inclusion of the Credit Shelter Trust and Marital Trust. These provisions aim to minimize or eliminate estate taxes, allowing for a more efficient transfer of assets to the spouse and children. 8. Legal Assistance: Given the complexity and legal implications involved in drafting a Beaumont Married Person's Will with Children, it is strongly recommended seeking professional legal assistance to ensure that the document accurately reflects personal intentions and adheres to relevant Texas laws and regulations. Consulting an experienced estate planning attorney can provide peace of mind and ensure the proper execution of one's final wishes.
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.
