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Review Your Trust Every 2 to 3 Years

Why Should You Review Your Trust Every 2 to 3 Years in San Diego?

Why should you review your trust every 2 to 3 years?  Many people mistakenly believe that “a trust is a trust” and once it is set up you never have to think about it again.  Estate planning is not stagnant.  Relationships change.  Laws change.  Lifestyles change.  San Diegans gain new assets and dispose of old assets, and want to ensure that everything to be protected by the trust is included in their trust.

One example of a major development recently is the “Qualified Terminable Interest Property Trust” more commonly referred to as a QTIP.  Most California trusts between spouses are known as “A-B” trusts.  Generally speaking, an A-B trust holds half of the assets of the couple upon the death of the first spouse, making it difficult for the survivor to access them if needed.  A QTIP is an irrevocable trust which allows one spouse to distribute assets to their spouse while preserving important options regarding the marital tax deduction. A QTIP would supplement the old A-B model for some families, as it allows the surviving spouse more options when it comes to the financial assets of the couple before and after the passing of the first spouse.

If you review your trust every 2 to 3 years our experienced tax and estate planning attorney can review your unique circumstances and update existing strategies based upon:

  1. Changes in your own life or that of your spouse, and/or
  2. Changes in the IRS or California Tax Code.

For example, parents entering into a new blended family may wish to ensure that their own children are absolutely provided for in the event of their passing.  There have been many cases recently where a spouse has passed believing that half of the assets would go to their children. However, the surviving spouse has decided to utilize those funds for other purposes reducing the inheritance of the children of the spouse who passed first.

Any strategy which involves estate planning and trusts is designed to shield your assets from taxation, and ensure that your beneficiaries receive everything you intend.  It is important to ensure that the terms of your trust agreement reflect the current realities of your life, as well as your intentions for beneficiaries.  This is why it is important to review your trust every 2 to 3 years.

We invite you to learn more about the latest developments in the areas of estate planning and trusts, as well as the integrated tax, legal, accounting and business consulting services of Allen Barron. Contact us or call today to schedule a free consultation at 866-631-3470.