Disclaimer: This blog post is for informational purposes only and does not constitute legal advice. Laws change frequently and there is no guarantee that the information in this post will be applicable or correct when you read this. You should consult with an attorney to discuss your specific situation.
Marital Trusts and Their Role in a Well-Designed Estate Plan
When couples begin estate planning, one of the most common goals is simple: take care of each other while also protecting what they’ve built. A marital trust is a powerful estate planning tool that helps married couples do exactly that—while also providing tax efficiency, asset protection, and long-term control over how assets are distributed.
Understanding how a marital trust works, if you need one, and how it fits into an overall estate plan, can help families avoid unnecessary taxes, probate delays, and future conflicts. Below, we’ll break down what a marital trust is, why it matters, and when it may be appropriate as part of a comprehensive estate plan.
What Is a Marital Trust?
A marital trust is a type of trust created for the benefit of a surviving spouse after one spouse passes away. Assets placed into the marital trust are generally available to support the surviving spouse during their lifetime, but the trust also controls what happens to those assets after the surviving spouse’s death.
One of the defining features of a marital trust is that may qualify for the unlimited marital deduction under federal estate tax law. This means assets transferred into a properly structured marital trust are not subject to estate taxes at the first spouse’s death.
Marital trusts are often created as part of a revocable living trust or a broader estate plan rather than as a standalone document.
Why Marital Trusts Matter in Estate Planning
A marital trust is not just about taxes—it’s about control, protection, and peace of mind. Here’s why many couples choose to include one in their estate plan:
1. Providing Financial Security for a Surviving Spouse
A marital trust ensures the surviving spouse has access to income and, in many cases, principal from the trust. This can help cover living expenses, healthcare costs, and lifestyle needs without placing assets directly in the spouse’s name.
This structure can be especially helpful when:
One spouse handles most financial decisions
There are concerns about future remarriage
Long-term care planning is a priority
2. Protecting Assets for Children and Future Beneficiaries
One common concern is what happens after the surviving spouse passes away—especially in blended families. A marital trust allows the first spouse to pass away to set clear instructions about who ultimately receives the remaining assets.
For example, a marital trust can:
Provide lifetime support for the surviving spouse
Ensure remaining assets pass to children from a prior marriage
Prevent assets from being unintentionally redirected due to remarriage or outside influence
This makes marital trusts especially valuable in blended family estate planning situations.
3. Estate Tax Planning Benefits
While federal estate tax exemptions are currently high, they are subject to change. A marital trust can play a critical role in long-term tax planning, especially for higher-net-worth couples.
Marital trusts:
Defer estate taxes until the second spouse’s death
Preserve tax benefits when paired with other trusts
Work alongside strategies like portability and bypass trusts
For families with real estate, investments, or business interests, this flexibility can be crucial.
Types of Marital Trusts Commonly Used
There isn’t just one type of marital trust. The structure used depends on a couple’s goals, asset levels, and family dynamics.
Qualified Terminable Interest Property (QTIP) Trust
A QTIP trust is one of the most common forms of marital trust. It provides income to the surviving spouse for life while allowing the first spouse to control who receives the remaining assets later.
This option is often used when:
There are children from a previous marriage
The spouses want unequal final distributions
Asset control is a top priority
General Power of Appointment Marital Trust
This type of marital trust gives the surviving spouse more control, including the ability to decide who receives the remaining assets. While it offers flexibility, it may expose assets to estate taxes at the surviving spouse’s death.
The right choice depends on balancing control versus flexibility, which is why personalized legal guidance matters.
How a Marital Trust Fits Into a Complete Estate Plan
A marital trust is rarely used alone. Instead, it works alongside other estate planning tools to create a comprehensive plan.
A well-designed estate plan may include:
A marital trust for spousal support
A bypass or family trust
Together, these tools help avoid probate, maintain privacy, and ensure wishes are carried out efficiently.
When Is a Marital Trust a Good Idea?
A marital trust may be especially beneficial if you:
Own significant assets or real estate
Want to protect children from prior relationships
Are concerned about future remarriage
Want to maintain control over asset distribution
Are focused on minimizing estate taxes
Even couples with more modest estates may benefit from a marital trust when asset protection and long-term planning are priorities.
The Importance of Proper Drafting
Marital trusts must be carefully drafted to meet legal and tax requirements. A poorly structured trust can lead to:
Loss of tax benefits
Unintended distributions
Family disputes
Increased probate or court involvement
Working with an experienced estate planning attorney like those at Yu and Yu Law, ensures your marital trust aligns with your overall goals and adapts as laws and life circumstances change.
Marital Trusts Are About More Than Money
At its core, a marital trust is about caring for your spouse while protecting your legacy. It offers structure during a difficult time and clarity for the future, helping families avoid confusion, conflict, and unnecessary expense.
Every family is different, and there is no one-size-fits-all estate plan. A marital trust may be a key component—or just one piece—of a broader strategy designed around your unique needs. Click here to book a free consultation.