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.
Collin Texas Marital Deduction Trust: Trust A and Bypass Trust B In Collin, Texas, the Marital Deduction Trust is a legal arrangement designed to provide asset protection and estate planning benefits for married couples. Trust A, also known as the "Marital Trust" or "A Trust," and Trust B, also referred to as the "Bypass Trust" or "B Trust," are two types of trusts commonly used in this estate planning strategy. Trust A, or the Marital Trust, is established to benefit the surviving spouse upon the death of the first spouse. The main purpose of Trust A is to make use of the unlimited marital deduction, which allows assets to pass to the surviving spouse without incurring estate taxes. By utilizing this deduction, Trust A can help minimize or eliminate estate tax liability, ensuring a smooth transfer of assets between spouses. The assets placed within Trust A are managed and distributed for the benefit of the surviving spouse. The surviving spouse typically receives income generated by the assets, and may also have the ability to access the principal if needed. Trust A provides a level of protection for the surviving spouse's assets, shielding them from potential creditors or future estate tax exposure. Trust B, or the Bypass Trust, complements Trust A by capturing the remaining portion of the deceased spouse's estate. It is created to fully utilize both spouses' estate tax exemptions and ensure the preservation of wealth for future generations. Trust B can be funded with an amount up to the federal estate tax exemption amount, thereby protecting it from inclusion in the surviving spouse's estate for federal estate tax purposes. While the specific provisions and terms of Trust A and Trust B may vary depending on each couple's unique circumstances, they generally work together to optimize estate tax planning and asset protection. These trusts can provide the surviving spouse with financial security while preserving wealth for the couple's heirs. It's important to note that creating and managing a Marital Deduction Trust in Collin, Texas, requires the expertise of a qualified attorney, well-versed in estate planning and tax laws. They can assist in tailoring the trusts to meet the couple's specific goals and objectives, ensuring their wishes are carried out efficiently and effectively. In summary, the Collin Texas Marital Deduction Trust comprises Trust A (Marital Trust) and Trust B (Bypass Trust). These trusts are integral components of an estate planning strategy for married couples, helping to minimize estate taxes, protect assets, and ensure the smooth transfer of wealth to future generations. Seeking professional legal advice is crucial to establish and manage these trusts properly.Collin Texas Marital Deduction Trust: Trust A and Bypass Trust B In Collin, Texas, the Marital Deduction Trust is a legal arrangement designed to provide asset protection and estate planning benefits for married couples. Trust A, also known as the "Marital Trust" or "A Trust," and Trust B, also referred to as the "Bypass Trust" or "B Trust," are two types of trusts commonly used in this estate planning strategy. Trust A, or the Marital Trust, is established to benefit the surviving spouse upon the death of the first spouse. The main purpose of Trust A is to make use of the unlimited marital deduction, which allows assets to pass to the surviving spouse without incurring estate taxes. By utilizing this deduction, Trust A can help minimize or eliminate estate tax liability, ensuring a smooth transfer of assets between spouses. The assets placed within Trust A are managed and distributed for the benefit of the surviving spouse. The surviving spouse typically receives income generated by the assets, and may also have the ability to access the principal if needed. Trust A provides a level of protection for the surviving spouse's assets, shielding them from potential creditors or future estate tax exposure. Trust B, or the Bypass Trust, complements Trust A by capturing the remaining portion of the deceased spouse's estate. It is created to fully utilize both spouses' estate tax exemptions and ensure the preservation of wealth for future generations. Trust B can be funded with an amount up to the federal estate tax exemption amount, thereby protecting it from inclusion in the surviving spouse's estate for federal estate tax purposes. While the specific provisions and terms of Trust A and Trust B may vary depending on each couple's unique circumstances, they generally work together to optimize estate tax planning and asset protection. These trusts can provide the surviving spouse with financial security while preserving wealth for the couple's heirs. It's important to note that creating and managing a Marital Deduction Trust in Collin, Texas, requires the expertise of a qualified attorney, well-versed in estate planning and tax laws. They can assist in tailoring the trusts to meet the couple's specific goals and objectives, ensuring their wishes are carried out efficiently and effectively. In summary, the Collin Texas Marital Deduction Trust comprises Trust A (Marital Trust) and Trust B (Bypass Trust). These trusts are integral components of an estate planning strategy for married couples, helping to minimize estate taxes, protect assets, and ensure the smooth transfer of wealth to future generations. Seeking professional legal advice is crucial to establish and manage these trusts properly.
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.
