Is a credit shelter trust the same as a bypass trust?

Credit shelter trusts are also known as AB Trusts or Bypass Trusts. This is because CSTs are essentially bypass trusts in which each spouse has a separate "taxable" estate. These estates are known as A trust and B trust.

What kind of trust is a marital trust?

A marital trust is a type of irrevocable trust that allows you to transfer assets to a surviving spouse tax free. It can also shield the estate of the surviving spouse before the remaining assets pass on to your children.

Can surviving spouse be trustee of marital trust?

A marital trust starts as a revocable living trust. A surviving spouse can be its trustee.

What is the benefit of a marital trust?

A marital trust allows the couple's heirs to avoid probate and take less of a hit from estate taxes by taking full advantage of the unlimited marital deductiona provision that enables spouses to pass assets to each other without tax consequences.

What is the difference between a marital trust and a family trust?

At the time of your death, the assets in your family trust are protected by the exemption, and the assets in your marital trust are protected by the marital deduction. No estate taxes are due.

Can surviving spouse be trustee of credit shelter trust?

Yes, the surviving spouse may serve as trustee of the credit shelter trust.All of the assets in the credit shelter trust, including any appreciation in value during the surviving spouse's lifetime, pass free of estate tax to the beneficiaries.

Does a credit shelter trust get a step up in basis?

First, in a standard credit shelter trust, there is no step-up in basis at the death of the surviving spouse.Second, the credit shelter trust is a separate taxpayer and requires its own tax return, Form 1041.

What are the disadvantages of a family trust?

Costs of setting up the trust. A trust agreement is a more complicated document than a basic will. Costs of funding the trust. Your living trust is useless if it doesn't hold any property. No income tax advantages. A will may still be required.

Maryland Complex Will with Credit Shelter Marital Trust for Large Estates

Name: Maryland Complex Will with Credit Shelter Marital Trust for Large Estates
Brand: US Legal Forms
Price: 59.00 USD
Rating: 4.65 (257 reviews)

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Description

This Complex Will with Credit Shelter Trust for Large Estates form is a complex Will designed to enable a couple to maximize the amount of property that can pass free of estate taxes. The Will leaves the maximum tax free amount allowed (i.e. 1,000,000.00 as of 2001) to a trust and the remainder of property to the surviving spouse. All of the property passing to the Spouse is estate tax free. Therefore, no estate taxes are due at the death of the first Spouse. Since the trust has 1 million dollars that can pass to the children tax free, the surviving spouse can also leave 1 million to a similar trust or children and thereby enable 2 million dollars instead of 1 to pass to the children estate tax free. Income from the trust can be disbursed to the surviving spouse and children.

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