My wife and I own our home in California and have good retirement
I think we would benefit from an A/B trust. Can I establish an A/B
trust and put
our assets into it by myself, or is this something an intelligent non-
pays a lawyer to do?
Nolo Press has some do-it-yourself information about this at nolo.com,
and also some books, I think.
Whether do-it-yourself is a good idea or not is not easy to answer.
Problems probably won't be discovered until you are dead and can't fix
As I understand it, the current federal estate tax laws do not start
taxing inheritances until $5 million, and any unused portion of the
estate of the first to die is transferred to the surviving spounse, so
maybe it is moot until 2013. Who knows what Congress will do with
those limits in two years.
Ask at misc.legal.moderated for another opinion.
It isn't that most folks aren't smart enough to do this on their own.
Rather, its more that this is one of those areas where its best to use a
professional, if for no other reason than because WHEN a question will arise
about what something means it will happen AFTER you're dead. Its very hard
to get dead folks to answer questions.
I'd recommend that you get some info on A/B trusts, maybe buy a DIY kit from
someone like NOLO Press and go over the paperwork. Maybe even draft up your
own version so you'll understand what kind of information is needed. Then
go visit a trust lawyer to get the real version done. This way you won't
spend 3 hours thinking about answers to questions, you'll be better
Gene E. Utterback, EA, RFC, ABA
I'd say that the most important reason to hire a pro is that he might bring
up issues you hadn't thought of. Of course, for a simple A/B trust, the
"pros" are not all that professional. The real pros work on much more
interesting estate plans.
That is certainly wise when the problem faced is complex and contains
pitfalls of which only a professional is aware. In issues that arise
in medicine, law, tax accounting, engineering, etc. it is generally a
sensible and safe way to proceed. A difficulty that arises in
investment, finance, and various other kinds of services, however, is
that there are a lot of people pretending to be "professionals," who
in reality should be thought of as salesmen, or sometimes worse,
I believe those pretenders are numerous enough in the financial realm
such that the job of finding a true "professional" to help with
investments carries considerable risk. I would suggest the main focus
should be on insuring a FIDUCIARY relationship. What you want is a
knowledgeable professional who is subject to severe sanctions if he or
she acts in any way that conflicts with your own best interests and is
motivated by fear of what can actually happen by doing otherwise.
In the case of financial professionals I agree but the A/B trust is a
legal issue. If the OP finds an attorney who is certified by his state
bar association as an estate and trust specialist he should be
confident in getting someone competent.
Agreed! But the advice to "see a professional," although commonly made
in financial newsgroups and certainly wise in specific circumstances,
can be misinterpreted by novices to imply that anybody advertising to
provide advice is a professional.
having gone thru all this with my wife's parents and their real estate
one MAJOR thing has come to light....
In my observation - there are really 3 steps involved with any Trust
and one HUGE mis-understanding.... at least by myself.
1 - setup the Trust agreement - which is merely a paper doc filed with a
2 - re-assign, convey, or transfer assets to the Trust as the "owner"
3 - this is the kicker - keep a really good file of what is actually in the
I had thought that the Trust was like some kind of account,
and you would then be able to see all the items listed out in the "Trust"
This is not true.... you have to do it all on your own.
My wife's parents had setup the Trust, but NEVER actually transferred
When they died - we all thought the Trust was set.... it was just a useless
piece of paper.
It's taken several years to get all the properties transferred into the
Trust - only in name -
SO - correct me if I'm wrong - but the biggest part of the Trust,
is actually having someone keep track of exactly what is in the Trust -
yes, that is the biggest part of any trust, any business, any household,
etc. Few things in life are "set it and forget it".
And, I am unaware that the trust instrument (document) has to be "filed with
a local state". Or anywhere else.
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