What is an A/B Trust?

A/B Trusts often help meet the needs of families that have a desire to create a revocable trust but recognize that at some point one spouse will pass and the other will be left to deal with life changes and challenges in the world alone.

This type of trust provides for two trusts to be created at the death of the first spouse, known as Trust A and Trust B. Trust A belongs to the surviving spouse and Trust B belongs to the deceased spouse. The A trust is subject to change and is amendable and revocable by the surviving spouse, meaning he or she can make changes to the beneficiaries as they wish. Trust B, however, is irrevocable, and while the surviving spouse may receive the lifetime benefit from that trust, such as the income and principal, the survivor is not permitted to make changes to the trust and cannot disinherit the deceased spouse’s designated beneficiaries. 

This type of trust allows for some protection for the children of the spouse who passes away first. The surviving spouse may someday decide to remarry or change their portion of who benefits based on events that take place after the first spouse’s death. This protects the deceased spouse’s portion of their estate from being changed at all, but leaves the surviving spouse with the ability to make changes to their portion of the trust. You can imagine that this type of a trust is desirable for couples who have blended families, are in their second marriage, or have remarriage concerns.

When these types of events take place, there are often upset feelings and sometimes things happen that were not foreseeable by the deceased spouse. An AB trust allows spouses to create protection for their beneficiaries so that no matter what the future holds, their wishes regarding distribution of assets will be carried out.

If you are interested in learning more about trusts and what options you can put in place to protect both your property and your loved ones please call our office for an appointment or attend one of our monthly seminars to learn about how you can make smart decisions about your property and finances.

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James F. Roberts
Founder and owner of the Law Office of James F. Roberts and Associates, a premiere estate planning law firm
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