Living Trust for Married Couples

By Larissa Bodniowycz, J.D.

Living Trust for Married Couples

By Larissa Bodniowycz, J.D.

Married couples can prepare a living trust as an estate planning tool to more quickly transfer assets upon death, keep family matters private, and sometimes, to minimize taxes.

Smiling, young couple in an office working at a laptop

Living Trust Defined

A living trust is a term used to refer to a revocable trust. A trust is a legally recognized arrangement under which one or more trustees hold assets for the benefit of one or more other people. A trust can have multiple grantors, trustees, and beneficiaries and the same person can hold multiple roles. Irrevocable trusts can be modified or terminated after they are created.

At least three people are needed to create a valid trust: a grantor, who transfers property into the trust; a trustee, who manages the trust assets; and a beneficiary, who receives the benefit of the trust asset. Married couples can create a joint living trust where both spouses are the grantors, trustees, and beneficiaries.

How a Living Trust For Married Couples Works

Under a typical arrangement, a married couple prepares a living trust, or more often, uses an online legal service or attorney to prepare one for them, and signs the trust. They then transfer assets they own separately or jointly into the name of the trust. The couple serves as the trustees of the trust and have full use and access to the trust property during their lives as its beneficiaries.

Usually, a living trust means that when one of the spouses passes away, the other spouse becomes the sole trustee and beneficiary. The living spouse continues to have full control and use of their property. After the second spouse dies, the property is typically distributed to the couple's surviving children or held in trust for them. Although this is the most common arrangement, a living trust is a flexible document that can be tailored to fit a couple's needs and desires.

Benefits of a Living Trust for Married Couples

Why would a couple choose a living trust instead of a will? There are a few reasons.

For the average married couple, the main benefit of using a living trust instead of a will is that a trust does not go through the probate process when each spouse passes away. This means property is accessible by the surviving spouse or the couple's children very quickly instead of being tied up in probate for months or even years.

Avoiding probate also means that the details of the married couple's estate plan remain private. Wills must be filed with the court and become public record when a person dies. Trust documents do not have to be filed with the court.

Married couples with large estates may be able to use a joint living trust to minimize tax burdens as part of their overall tax strategy. However, just creating a living trust and transferring assets into it is not enough. Minimizing or avoiding estate-related taxes requires more complicated planning and drafting. For example, two living trusts may need to be created, or in some cases, a different form of trust altogether.

A living trust is a valuable tool for many married couples, but should always be considered part of a comprehensive estate plan, not as the only estate planning document.

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not LegalZoom, and have not been evaluated by LegalZoom for accuracy, completeness, or changes in the law.