Federal tax aspects of a revocable inter vivos trust agreement should be carefully studied in considering whether to create such a trust and in preparing the trust instrument. There are no tax savings in the use of a trust revocable by the trustor or a non-adverse party. The trust corpus will be includable in the trustor's gross estate for estate tax purposes. The income of the trust is taxable to the trustor.
California Revocable Trust Agreement with Husband and Wife as Trustees and Income to: A Comprehensive Overview A Revocable Trust Agreement, specific to California, is a legally binding document that outlines how a couple's assets and properties will be managed, distributed, and protected during their lifetimes and after their death. In this particular case, the trustees are a husband and wife, and the trust agreement guarantees an income to them during their lifetimes. Now, let's delve into the key components and features of this California Revocable Trust Agreement: 1. Definition and Purpose: The California Revocable Trust Agreement establishes a trust where the husband and wife, as trustees (also known as granters, settlers, or creators), transfer their assets, such as real estate, investments, bank accounts, and personal property, into the trust. The primary purpose is to ensure efficient management, avoidance of probate, and seamless asset transfer upon their passing. 2. Revocability: As the name suggests, this trust agreement is revocable, meaning that the trustees maintain full control over their assets and have the authority to make modifications, amendments, or even revoke the trust entirely during their lifetime, given they are mentally capable. 3. Income Provisions: One distinct feature of this trust is the provision for income distribution. The trust agreement specifies that the husband and wife will be entitled to receive income generated by the trust assets during their lifetime. The income may include dividends, interest, rental income, or any other form of revenue generated from trust assets. 4. Successor Trustees: The trust agreement designates one or more successor trustees who will step in and manage the trust assets if the husband and wife become incapacitated or pass away. Successor trustees can be individuals (such as adult children or close family members) or professional entities, like trust companies or attorneys, to ensure the smooth transition and execution of the trust provisions. 5. Asset Distribution: Upon the passing of both trustees, the trust agreement outlines how the trust assets will be distributed. Commonly, it provides for the creation of separate shares for each beneficiary, be it the surviving spouse, children, grandchildren, or other named beneficiaries. The trust may also define specific conditions, such as age or milestones, for the beneficiaries to receive their shares. Different Types of California Revocable Trust Agreement with Husband and Wife as Trustees and Income to: 1. Standard Revocable Trust: This is the most common type of trust agreement where the husband and wife (as trustees) create a revocable trust, allowing them to retain control over the assets while alive. Upon their passing, the trust assets are transferred to the named beneficiaries, including but not limited to surviving spouse, children, or charitable organizations. 2. Pour-Over Will Trust: In addition to a revocable trust, the trustees also create a pour-over will. This type of trust agreement is used when the couple wants to ensure all assets not held in the trust during their lifetime "pour over" into the trust upon their death. It acts as a safety net to capture any assets accidentally omitted from the trust. Regardless of the specific type, a California Revocable Trust Agreement with Husband and Wife as Trustees and Income to provides individuals with peace of mind by ensuring proper management, control, and distribution of assets during their lifetime and after. It serves as an effective estate planning tool that minimizes complexities and streamlines financial affairs for the benefit of the trustees and their loved ones.
