When it comes to married couples, planning an estate can become complicated. Naturally, a spouse would want their estate to go to the other spouse before it goes to the kids. Minneapolis estate planning lawyers and professionals would always recommend a revocable trust for individuals who have families for the simple reason that this type of estate plan doesn’t need to go through probate, speeding up the transfer of assets to the family.
There are two revocable trust structure options for married couples. They can have one big trust for both members of the marriage, which is called a joint trust. Or they can do two separate trusts. Which structure the married couple chooses will depend on certain factors.
Should Married Couples Do a Joint Trust or Separate Trusts?
The basic trust structure for married couples is a joint revocable trust, which means that both members of the marriage have one big trust that they own together. In this structure, the trust assets go to the other spouse when one passes away. And when the surviving spouse also passes, the assets go to the children.
While a joint trust is recommended, there are considerations that need to be made. This is only a preferred tool if:
- There are no concerns about estate tax
- Both spouses agree that the money should go to the exact same place
- There is no prenuptial agreement
There Should Be No Concerns About Estate Tax
When there’s an estate tax issue between spouses, it’s ideal to keep their money separated so that they can take full advantage of the estate tax or death tax exemptions. Any substantial estate tax issue would need a separate trust for each spouse so that their assets can be controlled separately.
Both Spouses Agree Where the Money Goes
For a joint revocable trust to become effective, both spouses must agree that should one of them pass away, the assets will go to the other spouse first before the children. A situation where the spouses want to give the assets to different beneficiaries would call for a separate trust for each member of the marriage.
Speak with a Minneapolis Estate Planning Attorney to Help You Decide Which Type of Trust
Stone Arch Law Office in Minneapolis and Woodbury helps married couples decide which type of trust is best for them, a joint or separate trusts based on their specific situation. Book a call with our estate planning team today to learn more about how to protect your assets, loved ones, and yourself.
