No. of Recommendations: 9
Where can I find the statutes that govern the Beneficial Rights of Surviving Spouses?
Although my husband passed away 13 years ago, I recently read in a book about Living Trusts that the surviving spouse has 3 beneficial rights:
1 The right to all of the income of Trust B
2 The right to use any or all of the principal in Trust B as is
necessary to maintain the same standard of living, including any
medical needs,
3 The right to spend, each year, $ 5,000 or 5% of the assets in Trust
B, whichever is greater, for any reason, regardless of how frivolous.
This right is not cumulative, the right must be used during the year,
or it is lost.

The short answer is that these are not "Beneficial Rights" that exist in vacuum, but rather may or may NOT be included in the trust DEPENDING ON THE LANGUAGE OF THE ACTUAL TRUST (or, more specifically, the document which creates those trusts).

Also, it's not an "A/B trust", but rather, most basic estate planning incorporates an A/B trust structure, where one of two trusts (often the "A" trust) is a "credit shelter" trust, and the other (often the "B" trust) is a "Marital" trust.

The "B" trust is usually set up with the surviving spouse having rights to all income, but doesn't HAVE to be. Same with the other three items.

Every trust is different, and the estate tax consequences vary depending on the trust language, but although there are commonalities in much estate planning, your items are not universal rules that are applied to all trusts.

Also, for income tax issues, those vary depending on whether the trust is a "grantor trust" or not, among other things.

I'll also note that a LIVING TRUST (usually known as a Revocable Living Trust, or "RLT") is a different estate planning tool that often (but not always) establishes the "A/B Trust" structure at the death of the first spouse. I'll note that such a structure can also be set up by will, but RLTs are often used in states where probate can be messy (CA, for one) or where one wants increased privacy issues or more protection from challenges.

The short answer is that the intermaweb is a rotten place to ask for specific advice on this. You need to get with a tax attorney who specializes in estate and trust issues, and bring with the documents that establish your trusts.


Circular 230 Disclaimer - None of this is tax advice, I'm not your attorney or advisor, I may be dumb as a post and completely wrong and didn't even stay at a Holiday Inn Express last night, if you rely on what I say the IRS will laugh at you if you have issues with them, talk to a REAL tax attorney/financial advisor/actual person not on the intermawebz who knows about this stuff. All of the info in my post is worth even less than you paid for it.
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