What Is a Marital Trust in California?

By Jay S. Yu, Esq., Yu & Yu Law, Fullerton, California · Last reviewed October 2026

A marital trust holds property for your surviving spouse after you die, usually paying them income for life, and then passes what is left to the people you chose, often your children. Set up correctly, it qualifies for the federal marital deduction, so no federal estate tax is due at the first death. In California, the trust usually holds the deceased spouse’s half of the community property; the surviving spouse keeps their own half.

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, I’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 it 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 Use a Marital Trust?

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. Deciding Who Inherits What Remains

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 the federal estate tax exemption is currently high ($15 million per person as of 2026), it is subject to change. A marital trust can play a critical role in long-term tax planning, especially for higher-net-worth couples.

A marital trust defers federal estate tax; it does not eliminate it. Property in a QTIP trust is counted in the surviving spouse’s taxable estate at their death (26 U.S.C. § 2044), and so is property in a general power of appointment trust (26 U.S.C. § 2041). With the federal exemption at $15,000,000 per person as of 2026, most California couples owe no federal estate tax either way, and California has no estate tax of its own.

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.

What Are the Types of Marital Trusts?

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

The executor makes the QTIP election on the federal estate tax return, Form 706 (26 U.S.C. § 2056(b)(7)); without the election, the trust does not qualify for the marital deduction.

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. Like a QTIP trust, what remains is counted in the surviving spouse’s estate. The difference is control: the surviving spouse, not the first spouse, decides who receives it.

The right choice depends on balancing control versus flexibility, which is why personalized legal guidance matters.

How does a marital trust work with California community property?

California is a community property state. When the first spouse dies, the surviving spouse already owns their half of the community property outright, so a marital trust usually holds only the deceased spouse’s half and any of that spouse’s separate property. Both halves of community property generally receive a new tax basis at the first death (26 U.S.C. § 1014(b)(6)), which matters more than estate tax to many California families. A marital trust does not change that result, but the trust and the way title is held should be planned together. I explain the basis rules in the double step-up in basis.

Will funding a marital trust reassess my property taxes?

Generally, no. Transfers between spouses, including a transfer to a trustee for the benefit of a surviving spouse, are excluded from change in ownership under Revenue and Taxation Code section 63, so the home keeps its Proposition 13 assessed value while it is held for the surviving spouse. The later transfer to your children after the surviving spouse dies is a separate question under Proposition 19’s parent-child rules (Rev. & Tax. Code § 63.2).

Do I still need a marital trust if we have portability?

Not always. Portability lets a surviving spouse use the deceased spouse’s unused federal exemption, but only if the executor files a federal estate tax return, due nine months after death or by an extended deadline. An estate that was not otherwise required to file can make a late portability election up to five years after death under Rev. Proc. 2022-32. A marital trust does things portability cannot: it fixes who inherits what remains, which matters in blended families, and it keeps the property under a trustee’s management. Whether a marital trust, a bypass trust, or an outright gift to the survivor fits best depends on the size of the estate and the family, and it is one of the decisions I walk through when I design a revocable living trust.

What if my spouse is not a U.S. citizen?

The unlimited marital deduction does not apply to property passing to a surviving spouse who is not a U.S. citizen (26 U.S.C. § 2056(d)). The usual answer is a qualified domestic trust, or QDOT, which must have at least one trustee who is a U.S. citizen or a domestic corporation; the executor elects QDOT treatment on the estate tax return (26 U.S.C. § 2056A). If either spouse is not a citizen, raise it early so the trust is drafted for it.

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 revocable living trust

• A marital trust for spousal support

• A bypass or family trust

• Powers of attorney

• Advance healthcare directives

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 estate planning attorney 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. Book a free design session.

Disclaimer: This article is for informational purposes only and does not constitute legal advice. Laws change frequently and there is no guarantee that the information in this article will be applicable or correct when you read this. You should consult with an attorney to discuss your specific situation. This article discusses California law; Jay S. Yu is licensed to practice in California.