If you are married there are two very important issues which you need to consider when planning to have drawn a revocable marital trust:
1. If you have children or anticipate that you will, a question arises as to what happens if a child (who is not necessarily a minor) were to predeceased you? No one wants to consider such a horrific event but if not carefully planned out ( particularly if there is more than one child who stands to inherit), a lot of problems can develop. For example, if a child ( whether a minor or of majority) predeceased you does that child’s share go to your other children, if any, or is it left for the benefit of his/her surviving children (your grandchildren whether already born or to be born)? If your trust is silent or vague on the issue, you are setting the stage for disputes later amongst your family members.
2.What if after the death of the 1st spouse, the surviving spouse becomes mentally or physically incapacitated? If the surviving spouse is unable to carry out the terms of the trust who is going to take charge? Normally the husband and wife will appoint one of the children as a successor trustee. But if that person is unwilling or unable to serve, there is no one to carry out the terms of the trust. We therefore always advise spouses to appoint an alternate co-trustee to cover this contingency.
Successful marital trusts require a lot of planning. It is your job to think about what you want to happen if various contingencies were to occur and explain this to your attorney.
Stephen J. Gross an attorney in West Los Angeles specializes in real estate law, trusts and estates, rental property/ asset protection through entity formations, business and commercial law transactions and litigation. A free 1/2 hour phone consultation is offered to Pages LA readers. We can be reached at 310- 652 8090 or please visit sjgassociates.com.