An A-B trust is a revocable living trust which divides into two trusts upon the death of the first spouse. This type of trust makes use of both the estate tax exemption ($3.5 million per person in 2009) and the marital deduction to make it so that no estate taxes are due upon the death of the first spouse. The B Trust is also known as the Bypass trust and it contains the amount of that years applicable exclusion amount. The A trust is the marital deduction trust which will typically contain both the surviving spouse's separate property and one half community property interests but also the residue of the deceased spouse's estate after the estate tax exemption has been utilized by the B trust. The use of an A-B trust ensures that both spouse's applicable exclusion amounts are effectively used, thereby doubling the amount of property which can pass to heirs free of Federal Estate Taxes.
The Bexar Texas Marital Deduction Trust, also known as Trust A, and the Bypass Trust B are estate planning tools utilized by married individuals in Bexar County, Texas to help minimize estate taxes and ensure proper distribution of assets upon the death of one spouse. Trust A, also referred to as the Marital Deduction Trust, is created within an individual's estate plan to take advantage of the marital deduction allowed under federal tax laws. This trust is typically established upon the death of the first spouse, and the deceased spouse's assets are transferred into this trust to be held for the surviving spouse's benefit. By utilizing the marital deduction, the assets transferred to Trust A are not counted as part of the deceased spouse's taxable estate, thus potentially reducing estate taxes. The surviving spouse is usually entitled to income generated by the trust assets during their lifetime and may also have access to the principal if needed. Bypass Trust B, also known as the Credit Shelter Trust or the Family Trust, is designed to address estate tax planning needs while ensuring efficient asset distribution and preservation. Upon the death of the first spouse, a portion of their estate is transferred into Trust B, up to the maximum amount exempt from federal estate tax. The assets held in Bypass Trust B will pass outside the surviving spouse's taxable estate, mitigating potential estate tax liability upon their death. The surviving spouse may still receive income generated by the trust assets during their lifetime, but the principal is generally preserved for the benefit of the couple's children or other designated beneficiaries. It is important to note that there may be variations and specific arrangements within the Bexar Texas Marital Deduction Trust structure. These variations can be based on factors such as the value of the estate, the goals of the individuals involved, and other unique circumstances. Consulting with an experienced estate planning attorney in Bexar County, Texas is advisable to determine the most appropriate type of Bexar Texas Marital Deduction Trust and its specific configuration to meet individual needs. In summary, the Bexar Texas Marital Deduction Trust consists of Trust A (Marital Deduction Trust) and Trust B (Bypass Trust), both serving crucial purposes in reducing estate taxes and facilitating the smooth transfer of assets upon the death of one spouse.The Bexar Texas Marital Deduction Trust, also known as Trust A, and the Bypass Trust B are estate planning tools utilized by married individuals in Bexar County, Texas to help minimize estate taxes and ensure proper distribution of assets upon the death of one spouse. Trust A, also referred to as the Marital Deduction Trust, is created within an individual's estate plan to take advantage of the marital deduction allowed under federal tax laws. This trust is typically established upon the death of the first spouse, and the deceased spouse's assets are transferred into this trust to be held for the surviving spouse's benefit. By utilizing the marital deduction, the assets transferred to Trust A are not counted as part of the deceased spouse's taxable estate, thus potentially reducing estate taxes. The surviving spouse is usually entitled to income generated by the trust assets during their lifetime and may also have access to the principal if needed. Bypass Trust B, also known as the Credit Shelter Trust or the Family Trust, is designed to address estate tax planning needs while ensuring efficient asset distribution and preservation. Upon the death of the first spouse, a portion of their estate is transferred into Trust B, up to the maximum amount exempt from federal estate tax. The assets held in Bypass Trust B will pass outside the surviving spouse's taxable estate, mitigating potential estate tax liability upon their death. The surviving spouse may still receive income generated by the trust assets during their lifetime, but the principal is generally preserved for the benefit of the couple's children or other designated beneficiaries. It is important to note that there may be variations and specific arrangements within the Bexar Texas Marital Deduction Trust structure. These variations can be based on factors such as the value of the estate, the goals of the individuals involved, and other unique circumstances. Consulting with an experienced estate planning attorney in Bexar County, Texas is advisable to determine the most appropriate type of Bexar Texas Marital Deduction Trust and its specific configuration to meet individual needs. In summary, the Bexar Texas Marital Deduction Trust consists of Trust A (Marital Deduction Trust) and Trust B (Bypass Trust), both serving crucial purposes in reducing estate taxes and facilitating the smooth transfer of assets upon the death of one spouse.
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.
