The Curse of the A/B Trust
Member Presentation by Jennifer Martin
Estate planning can be terrifying for clients … and for estate planning attorneys!
Clients make estate-planning choices that make estate administration difficult, expensive and
Eliminate Your A/B Trust Structure
I strongly recommend to most clients that they eliminate their A/B trust structure. They
made sense when we needed to value assets when the first spouse passed away in order to
keep them under the estate tax exemption. But, with the exemption at $11.58 million per
person, most people don’t need a rigid A/B structure. A more flexible trust structure
allows the surviving spouse to live comfortably and adjust to changing circumstances,
while still passing property to the children when the surviving spouse dies.
Appoint a Single Successor
I also strongly recommend to most clients that they appoint a single successor trustee, not
co-trustees. Having two people in charge breeds conflict. A parent’s death creates:
conflict with a co-trustee, often a sibling, over what to do, and
can create a lasting rift.
For most people, a single trustee will prevent conflict, not cause it.
Finally, I strongly recommend to most clients that they don’t try to control their estate
from beyond the grave. Your successor trustee should be someone you trust with your
money and wishes. So, if you don’t feel comfortable giving them discretion over
the management of your assets, so they can adjust to changing circumstances, you should
probably appoint someone else. For most people, maximizing trustee discretion also
maximizes the value of the trust for their beneficiaries.
Let’s banish the ghosts of the A/B trust, co-trustees, and restrictive trust terms! Your
beneficiaries and your estate attorney will thank you.
About Jennifer Martin
Jennifer Martin is a partner at JARRATT MARTIN LAW, LLP, an estate
law, mediation and family law firm in Pleasanton. Her practice focuses on
estate planning, probate and trust administration, contested probate
litigation, conservatorships and business succession planning.