Legal Question in Wills and Trusts in California

Payments of debts and taxes article 5.1 of the California Probate code

The daughter of a famous person has set up a trust. She is now in her 90's and three friends of mine are named in her trust to receive large sums of money. There are royalities that will go to two heirs. The balance of the trust is to be divided among 5 people, my three friends and the two remaining heirs. The way the trust read, is that the liquid asset will go to pay the taxes on the Royalties, which will deplete most of the liquid assets. What stipulation can be added to the trust to prevent the liquid assets from being used to pay the taxes on Royalties? It seems the burden of taxes for the royalties should not be born by the parties that are not benefiting from the royalties. Can you help.


Asked on 9/02/08, 1:34 am

1 Answer from Attorneys
Donald Field Donald L. Field, Jr., Attorney at Law

Re: Payments of debts and taxes article 5.1 of the California Probate code

payment of debts and taxes in the case of a trust can be allocated as the settlor/trustor determines. if the trust is a revocable trust it is likely that it could be amended by the settlor/trustor to change the allocation of debts and taxes.

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Answered on 9/02/08, 10:20 am


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