A marital trust is a fiduciary relationship between a trustor and trustee for the benefit of a surviving spouse and the married couple’s heirs. Also called an “A” trust, a marital trust goes into effect when the first spouse dies. When the second spouse dies, the trust passes to its designated heirs.

Can a surviving spouse change a trust?

Like a will, a living trust can be altered whenever you wish. After one spouse dies, the surviving spouse is free to amend the terms of the trust document that deal with his or her property, but can’t change the parts that determine what happens to the deceased spouse’s trust property.

What happens to a bypass trust when the surviving spouse dies?

When the surviving spouse dies, all assets in the bypass trust go directly to the heirs. These assets “bypass” the second estate, so they are not included in the surviving spouse’s gross estate. Alternatively, assets could remain in the trust for the benefit of the heirs, if desired.

What happens to assets in a living trust when one spouse dies?

If you place your assets into a living trust, the assets and income will remain available to the surviving spouse after the death of the first spouse. When the surviving spouse dies, none of the assets from the first spouse are included in the surviving spouse’s estate because they are in the trust.

What can a surviving spouse do with a bypass trust?

The surviving spouse is only given certain rights and limited control over the assets in the bypass trust. They may receive income from the trust or may be given the right to invade the trust principal for his or her health, education or other approved support or maintenance.

Why do married couples need a living trust?

One reason for a living trust for a married couple is the opportunity to pass on their estates to their children in the most tax-efficient manner. When the first spouse dies, the surviving spouse is allowed to make use of all available tax benefits.

Can a surviving spouse compel a trustee to withdraw money?

The surviving spouse can compel the trustee to withdraw from the IRA an amount equal to all the income earned on the IRA assets at least annually and to distribute that amount to the spouse, and no person has a power to appoint any part of the trust property to any person other than the spouse.