If AB Trust Planning isn’t right for me, what other estate planning options are available to us as a married couple?
The current federal portability provision has facilitated a more simplified approach to trust planning. A couple can protect $10.98 million without using AB trust planning at today’s $5.49 million exemption amount.
Most clients who adopt this simplified approach use a joint trust rather than two separate trusts for each spouse. The advantage is that the entirety of the couple’s assets—after the death of a spouse—will receive a basis adjustment.
Many attorneys draft more flexibility into a trust by using a disclaimer provision for federal tax planning. With a disclaimer trust, the surviving spouse uses all or a portion of the deceased spouse’s estate tax applicable exclusion amount and gets the total of the assets in the trust.
** Disclaimer Required by IRS Circular 230** Unless otherwise expressly approved in advance by the undersigned, any discussion of federal tax matters herein is not intended and cannot be used 1) to avoid penalties under the Federal tax laws, or 2) to promote, market or recommend to another party any transaction or tax-related matter addressed.