Instead of leaving your property outright to your children or other beneficiaries on the death of the surviving spouse, consider leaving it to them in trust for life. Each child can be appointed trustee of his or her own trust at whatever age you think appropriate. The fact is that the property is in trust does not mean that your children will not be able to enjoy the use of the property. There are a number of advantages to this plan. The separate property character is preserved during the children’s lifetimes and this can be an important advantage in the event of divorce. In addition, the property can be protected from creditor’s claims should a child fall on hard times. Finally, careful use of the generation skipping exemption may allow all or a part of the property to pass to your great-grandchildren someday, without being subjected to estate taxes in your children’s estates.
BASIC ESTATE PLANNING DOCUMENTS
Trusts For Children For Life