What Are the Benefits of a Living Trust for Married Couples

What Are the Benefits of a Living Trust for Married Couples in California?  

By Attorney Paul Hanks, Ironclad Living Trusts  

A revocable living trust brings with it many extensive benefits for married couples in California. Often one of these benefits is a tax benefit. About 1 in 4 married couples in California hold title to their property as joint tenants, which creates a capital gains tax liability. An attorney hired to draft a revocable living trust will spot that deed irregularity and correct it before the couple’s home is transferred into trust. 

There are many other benefits for couples in California who choose a Revocable Living Trust. In the absence of a living trust, after the death of the first spouse, a spousal petition may be required to obtain a court order in regard to the deceased spouse’s interest in community property. If a trust were in place, the need for a spousal petition would be avoided. 

A revocable living trust brings a married couple the ultimate peace of mind. If a marital trust is not in place, the surviving spouse can do whatever they want with the property of the estate, and often that includes adding a new life partner to title on the family home. Married couples often make a huge mistake thinking that their estate is secure for their next generation without a trust in place. The truth of the matter is that once the first spouse dies, if the home is not in trust then the surviving spouse can add anyone to the home’s title who they desire. A marital revocable living trust contains key provisions which prevent the wealth of the first spouse to die from ending up in the pocket of a total stranger never known to that deceased spouse. 

A marital revocable living trust entirely eliminates all the risks that come with adding a child to title on a couple’s assets. In another blog this law firm addressed the many the Risks Come with Putting Your Child on Your House Title.

Married couples also want the most powerful assurance of probate avoidance, and the revocable living trust is the most powerful vessel for keeping the courts out of your estate affairs. If an estate is subject to probate, then the court and not your beneficiaries are in control over your estate for a very long time after your death. The cost of a California probate proceeding is staggering. If a trust were in place, instant control of your estate is in the hands of your chosen successor trustee. A California revocable living trust leaves the court on the sideline, and also allows for retention of an asset such as a home rather than its forced sale resulting from the need to cover the exorbitant court fees and costs.  

A marital revocable living trust contains powerful conservatorship provisions for those of us who sadly require conservatorship, whether due to a head injury or sudden accident at a younger age, or the later-in-life onset of dementia and Alzheimer’s disease. A conservatorship proceeding can consume a decade or more of the ill person’s life and the cost can consume many estates. 

A marital living trust also contains provisions which address your incapacity and provide for the protection of your estate resulting from government funded services through Medi-care or Medi-cal. The troubling reality is that a very large percentage of the elderly rely on government funded medical benefits as they age, and their home can be the subject of an estate recovery upon their death unless proper planning has been done. A marital revocable living trust serves as a powerful barrier and safeguards your estate from Medi-care estate recovery. 

And there are even more benefits that come with a marital living trust. Having a home titled in trust also makes it very difficult if not impossible for a scam artist to commit loan fraud or fraudulently obtain title. This unique protection is achieved by the critical recordation of a transfer deed of the home into trust.

And how about other financial predators? Without a trust in place, a great degree of protection has been lost against a scam artist seeking to prey on the elderly, who are of frail mind and highly vulnerable. A marital living trust empowers your successor trustee to protect your estate during that prolonged aging process which renders the elderly vulnerable to financial predators. 

In summary, there are enormous benefits that a revocable living trust brings married couples. You have worked hard for your wealth and should not risk it by a lack of comprehensive estate planning. An experienced living trust and estates law firm is an excellent resource to assess your estate planning options. 

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