Legal Question in Wills and Trusts in Arizona
Creating married couple Trust, Tax effects etc.
If a married couple creates a Trust, does it become irrevocable if one spouse dies? or can terms of the Trust allow amendments after one spouse passes?
What is the typical way to name a Trust for a married couple, the--name removed--Doe and Jane Doe Rev. Trust, or The Doe Family Trust?
In the case of a married couple's Trust, would they be required to obtain a TIN for the Trust when created? And if so how soon after creation? Or would they continue to file taxes with a joint return under their original SS#s? If a TIN is created would that require a new Trust tax return yearly in addition to the usual joint return? We would be talking about assets in the $500k-$1M range, with adjusted income $50-75K. (Ultimately, when both trustees pass, the son is successor to the real properties, one that produces rental income).
(If necessary, please also post under Taxation Law.)
1 Answer from Attorneys
Re: Creating married couple Trust, Tax effects etc.
Yes, you can create a joint trust and provide in the terms of the trust agreement that, upon the passing of the first grantor to die, that the surviving grantor can amend the trust agreement provisions. You can name the trust any way that you want, you have cited two typical examples. You do not need to get a tax ID number until the trust becomes a taxpaying entity. During the lifetimes of the grantors, the income of the trust is attributed to the grantors or the survivor of them. You would continue to file tax returns as you are doing now. Your testamentary disposition, as you describe it, can be carried out under the trust, and if you put all of your assets and property in title to the trust, then there would be no need for a probate and your son or other heirs would receive their shares very quickly.
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