Malcolm Moore, one of the country’s most outstanding estate planners, once wrote an article entitled “Joint Trusts: Are You Saving Anything More than Paper?” The answer often is “yes.” Frequently, spouses are told to separate their jointly-owned property so they each will have enough to use their full estate tax exemption. Sometimes, one or both spouses will be unhappy with the idea of separating property. However, with a joint revocable trust, they can have it all: a form of joint ownership with a full half of the assets available to fund the exemption of the spouse dying first. (Yes, they could rely on portability but now they have a choice: use the exemption or opt for portability.) And if they live in a community property state, they will still get the benefit of the “double step up” in income tax basis – receiving a step up on 100% of the property when the first spouse dies, and another step-up on all property included in the survivor’s estate at his or her later death.
Joint revocable trusts are also common in situations where estate taxes are not an issue and the spouses own most – or all – of their property jointly. Having only one trust eliminates the need to divide property between trusts created by each spouse, and can be a simpler plan for clients to understand if all property will pass to the same recipients. In any case, it’s important to understand how a joint revocable trust operates after the death of each spouse, both for tax and non-tax purposes.
An added benefit of a specific type of joint revocable trust is the availability of the double step up in basis (usually limited to taxpayers in community property states) to clients in ALL states. Clients in non-community property states, from New York to Florida to Minnesota to Oregon, can garner the same double step up in income tax basis for all their assets by creating an Alaska Community Property Trust – a special form of joint revocable trust.
This presentation will cover the use and operation of joint revocable trusts in general, for both taxable and non-taxable estates. The presenters will discuss when it may be advisable to use, or not use, a joint trust, and issues to consider. The speakers will also examine the Alaska Community Property Trust, and explain why it’s a relatively simple thing to provide clients in any state.
Jonathan G. Blattmachr, Esq., InterActive Legal Founder ^
Jonathan G. Blattmachr has over 35 years of experience in trusts and estates law and is currently a Principal at Pioneer Wealth Partners, LLC. He is a retired member of Milbank Tweed Hadley & McCloy and the Alaska, California and New York Bars. Mr. Blattmachr writes and lectures extensively on estate and trust taxation and charitable giving and has authored or co-authored eight books and over 500 articles on estate planning topics. He also co-developed Wealth Transfer Planning™, an InterActive Legal software system published for lawyers that provides specific client advice and automated document assembly for wills, trusts, powers of attorney, and other estate planning documents.
BethAnn Boudah Chapman, Esq., Faulkner Banfield ^
BethAnn Boudah Chapman (“Beth”) has practiced law in Juneau for over 30 years in the areas of estate planning, probate, and trust law. Beth also advises small businesses on business transition and other matters. She is an elected fellow and former state chair of the American College of Trust and Estate Counsel (www.actec.org), holds an “AV” rating from Martindale Hubbell Law Directory, and is listed in Super Lawyers. Beth received her BA from Saint Michael’s College and her JD from the University of Oregon School of Law where she was inducted into the Order of the Coif. She is a frequent speaker and author on estate planning issues.
Michael L. Graham is CEO of ILS Management, LLC ^
Prior to 1994, Mr. Graham was with the law firm of Baker & Botts for 22 years, first as a partner in the Houston Business and Estate Planning group, and then as partner in charge of B&B’s Business and Estate planning group in Dallas. Mr. Graham limits his practice to substantial matters involving business and estate planning, administration of estates and trusts, and fiduciary based litigation.
Mr. Graham received his J.D., cum laude, from Baylor School of Law (1972), and BBA from Baylor University (1971). He is Board Certified in Estate Planning and Probate Law in Texas. Mr. Graham’s professional activities include: Fellow of, and past Regent of, the American College of Trust and Estate Counsel; Past Supervisory Council Member of the American Bar Association’s Real Property, Probate and Trust Law Section, Co-Chair of the Digital Signature Committee; Past President of the Texas Academy of Probate and Trust Lawyers; Past Chair of the Real Estate, Probate and Trust Law Section of the State Bar of Texas; and Fellow of the International Academy of Estate and Trust Lawyers.
InterActive Legal is not an approved Continuing Education Sponsor. However, several states and regulatory agencies for a variety of professionals that participate on our teleconferences may still receive continuing education credit for their participation. If a participant wishes to receive CE credit for their participation in these teleconferences, they must apply to receive credit on their own and through their individual states and regulatory authorities. It is the responsibility of the participant to file for CE credit and is not guaranteed by InterActive Legal.
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