Set up a Living Trust with your spouse: Joint Living Trust
What is a Joint Living Trust?
A married couple can use a Joint Living Trust to establish a solid estate plan. With a Joint Living Trust you and your spouse can avoid probate court, reduce or eliminate estate taxes and also avoid conservatorship proceedings. When your property is placed into a Trust, you and your spouse can control your assets and property using this single trust document. You will be able to determine how your assets are managed during your lifetime and how they will be dispersed after your death.
When to use a Joint Living Trust:
- You're a married couple and want to have one joint living trust to controlled both spouses' assets.
- You and your spouse want to avoid going to probate court should one spouse pass away.
- You both want to designate the persons or organizations that will receive your assets after your death.
- You and your spouse want to designate the person who will carry out your wishes.
- You want to create a system to manage your assets if you become unable or unwilling to manage them yourself.
- You want to designate a caretaker for your pet(s) after your death.
- Note: If you expect the value of your estate to exceed federal estate tax exemption amount, this document is best used as a reference tool. A lawyer should be consulted for more complex estate planning.
Sample Joint Living Trust
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This Joint Living Trust Agreement (this "Agreement"), dated , between and (the "Grantors" or "Beneficiaries") of , and
In consideration of the mutual covenants and promises set forth in this Agreement, the Grantors and the Trustee agree as follows:
. PURPOSE. The purpose of this Agreement is to establish a Trust to receive and manage assets for the benefit of the Grantors during the Grantors' lifetimes, and to further manage and distribute the assets of the Trust upon the death of the surviving Grantor.
. FUNDING OF TRUST. This Trust shall be funded with assets transferred to this Trust by either or both of the Grantors at the time of creating this Trust, or at any later time. Any community property transferred into or out of this Trust shall remain community property until the death of either Grantor and such property, including undistributed income that it generates, shall not be commingled. This Trust may also receive property from any person or entity who is acting under the authority granted to that person or entity by the Grantors. It is also expected that this Trust may receive assets pursuant to the terms of either Grantors' Last Will and Testament.
. MANAGEMENT OF TRUST ASSETS. The Trustee shall manage and distribute the trust assets for the benefit of the Grantors and their successor(s) in interest in accordance with the terms of this Agreement.
. PAYMENTS DURING THE LIFETIMES OF THE GRANTORS. During the joint or survivor lifetimes of the Grantors, the Trustee shall pay all of the net income of this Trust, and also such sums from principal as either Grantor may request at any time in writing, to or for the benefit of the Grantors, or as either Grantor may designate. Such payments shall be made at least . The Grantors may change the amount of the payments at any time by providing written notice to the Trustee. Any excess income shall be added to principal at the discretion of the Trustee.
A. Payments During a "Disability" of a Grantor. During any period that a Grantor has a "disability", the Trustee may pay to or for the benefit of such Grantor such amounts of income and principal as the Trustee believes in the Trustee's sole discretion to be required for (i) such Grantor's support, comfort and welfare, (ii) such Grantor's accustomed manner of living, or (iii) any purpose that the Trustee believes to be in the best interest of such Grantor.
B. Disability Defined. For the purposes of this Trust, "disability" shall mean a legal disability or the inability to provide prompt and intelligent consideration to financial matters by reason of illness or mental or physical disability. The determination of whether a Grantor has a disability shall be made by such Grantor's most recent attending physician. The Trustee shall be entitled to rely on written notice of that determination.
. DEATH OF A GRANTOR. Upon the death of the first of the Grantors to die (the "Decedent"), the Trust shall become irrevocable with respect to the property contributed to the Trust by the Decedent (including accumulated income on that property, but excluding trust property given to the surviving Grantor) and shall continue for the benefit of the surviving Grantor (the "Surviving Grantor"), subject to distributions (if any) that may be required (i) by this Agreement, or (ii) to pay the just debts, funeral expenses, and expenses of last illness of the Decedent.
predeceased . predeceased .
| This amount or item shall be distributed upon the death of . |
| This amount or item shall be distributed upon the death of the Surviving Grantor. |
. DISTRIBUTION OF RESIDUARY TRUST ASSETS UPON THE SURVIVING GRANTOR'S DEATH. Upon the death of the second of the Grantors to die (the "Surviving Grantor"), the residuary assets of this Trust shall be distributed to of , . If such beneficiary does not survive the Surviving Grantor, the residuary assets shall be relating to the succession of separate property that is not attributable to a predeceased spouse, relating to the succession of separate property that is not attributable to a predeceased spouse, relating to the succession of separate property that is not attributable to a predeceased spouse, distributed to the heirs-at-law of , their identities and respective shares to be determined under the laws of the State of , then in effect, as if had died intestate at the time fixed for distribution under this provision and not survived by . distributed to the heirs-at-law of , their identities and respective shares to be determined under the laws of the State of , then in effect, as if had died intestate at the time fixed for distribution under this provision and not survived by . distributed % to the heirs-at-law of and % to the heirs-at-law of , their identities and respective shares to be determined under the laws of the State of , then in effect, as if each Grantor, respectively, had died intestate at the time fixed for distribution under this provision and not survived by the other Grantor. distributed to of , . If such beneficiary does not survive the Surviving Grantor, the residuary assets shall be relating to the succession of separate property that is not attributable to a predeceased spouse, relating to the succession of separate property that is not attributable to a predeceased spouse, relating to the succession of separate property that is not attributable to a predeceased spouse, distributed to the heirs-at-law of , their identities and respective shares to be determined under the laws of the State of , then in effect, as if had died intestate at the time fixed for distribution under this provision and not survived by . distributed to the heirs-at-law of , their identities and respective shares to be determined under the laws of the State of , then in effect, as if had died intestate at the time fixed for distribution under this provision and not survived by . distributed % to the heirs-at-law of and % to the heirs-at-law of , their identities and respective shares to be determined under the laws of the State of , then in effect, as if each Grantor, respectively, had died intestate at the time fixed for distribution under this provision and not survived by the other Grantor. relating to the succession of separate property that is not attributable to a predeceased spouse, relating to the succession of separate property that is not attributable to a predeceased spouse, relating to the succession of separate property that is not attributable to a predeceased spouse,
any children born to or adopted by the Grantors after the signing of this Agreement.the Grantors' child.the Grantors' children.
The custodian (whether trustee or guardian) of my assets may transfer all or part of the custodial property to a qualified minors trust without court order provided that the trust meets the requirements of Internal Revenue Code section 2503(C).
The shares shall be distributed to the Grantors' surviving children (and/or surviving descendants, in the case of a deceased child, by right of representation) and this Trust shall then terminate.
1. With respect to each share provided for a child of the Grantors then living:
a. Because each child has attained the age of years, each child shall have the right, by written request, to withdraw one-third in value of the remaining assets of such child's share then being held in trust.
b. Each child who has attained the age of years, and each remaining child upon attaining such age shall have the right, by written request, to withdraw one-half in value of the remaining assets then being held in such child's share.
c. Each child who has attained the age of years, and each remaining child upon attaining such age shall have the right, by written request, to withdraw the remaining assets then being held in such child's share, and if that child does so withdraw the remaining assets, the Trust as to that share shall terminate.
d. The withdrawal rights described in paragraphs (a) and (b) shall be cumulative, so that if the child has already attained the age specified in paragraph (b) at the time the Trust is divided into shares, the child shall have the right to withdraw a total of two-thirds in value of the remaining principal then being held in that child's trust share. However, in the event that the child does not make a request for a distribution within six months after attaining eligibility to do so, the amount of such distribution shall not be distributed by the Trustee except as either (i) a part of the next succeeding distribution, or (ii) as provided in paragraph (e).
e. Prior to final distribution to each child, as provided in this section, the Trustee shall pay to each child such sums from the income or principal of that child's share as the Trustee deems advisable for such child's health, education, support, and maintenance. Any income not distributed shall be added to principal.
f. If a child of the Grantors dies before receiving full distribution of such child's share, the remainder of such child's share shall be distributed by right of representation to such child's descendants, if any, or if none, by right of representation to the Grantors' descendants. Each portion distributable to a descendant of the Grantors for whom a share of this Trust is being held shall be distributed to the Trustee of that share and become a part of that share.
2. With respect to each share provided for the then living descendants, collectively, of a deceased child of the Grantors, the Trustee shall distribute that share by right of representation to the descendants of the deceased child.
3. If no child of the Grantors survives to age years, and if none of the Grantors' children have surviving descendants, the Trustee shall distribute the remaining Trust assets in the manner set forth in the paragraph "No Surviving Descendants."
4. Upon the death of a trust beneficiary under the circumstances contemplated by this section ("Use and Distribution"), the Trustee, in the Trustee's discretion, may pay the expenses of last illness, funeral, and related expenses of such deceased beneficiary from Trust assets.
5. Whenever income or principal is to be used for the benefit of a person under the age of eighteen (18) years or a person who in the judgment of the Trustee is incapable of managing such person's own affairs, the Trustee may make payment of such property in any or all of the following ways:
a. By paying such property to the parent, guardian, conservator, or other person having the care and control of such person for such person's benefit or to any authorized person as custodian for such person under the Uniform Transfers to Minors Act or equivalent legislation.
b. By paying such property to the guardian, conservator or other person having the care and control of any incapacitated person.
c. By paying directly to any such beneficiary such sums as the Trustee may deem advisable as an allowance.
d. By expending such property in such other manner as the Trustee in its discretion believes will benefit any such beneficiary.
distributed to 's heirs-at-law, their identities and respective shares to be determined under the laws of the State of , then in effect, as if had died intestate at the time fixed for distribution under this provision. distributed to 's heirs-at-law, their identities and respective shares to be determined under the laws of the State of , then in effect, as if had died intestate at the time fixed for distribution under this provision. distributed to the following beneficiaries in the percentages as shown:
% to 's heirs-at-law, their identities and respective shares to be determined under the laws of the State of , then in effect, as if had died intestate at the time fixed for distribution under this provision.
% to 's heirs-at-law, their identities and respective shares to be determined under the laws of the State of , then in effect, as if had died intestate at the time fixed for distribution under this provision.
% - Percent Total
. TRUSTEE POWERS. The Trustee, in addition to other powers and authority granted by law or necessary or appropriate for proper administration of the Trust, shall have the following rights, powers, and authority without order of court and without notice to anyone:
. Receive Assets. To receive, hold, maintain, administer, collect, invest and reinvest the trust assets, and collect and apply the income, profits, and principal of the Trust in accordance with the terms of this instrument.
. Receive Additional Assets. To receive additional assets from other sources, including assets received under the Will of a Grantor or any other person.
. Standard of Care. To acquire, invest, reinvest, exchange, retain, sell, and manage estate and trust assets, exercising the judgment and care, under the circumstances then prevailing, that persons of prudence, discretion and intelligence exercise in the management of their own affairs, not in regard to speculation but in regard to the permanent disposition of their funds, considering the probable income as well as the probable safety of their capital. Within the limitations of that standard, the Trustee is authorized to acquire and retain every kind of property, real, personal or mixed, and every kind of investment, specifically including, but not by way of limitation, bonds, debentures and other corporate obligations, and stocks, preferred or common, that persons of prudence, discretion, and intelligence acquire or retain for their own account, even though not otherwise a legal investment for trust funds under the laws and statutes of the United States or the state under which this instrument is administered.
. Retain Assets. To retain any asset, including uninvested cash or original investments, regardless of whether it is of the kind authorized by this instrument for investment and whether it leaves a disproportionately large part of the estate or trust invested in one type of property, for as long as the Trustee deems advisable.
. Dispose of or Encumber Assets. To sell, option, mortgage, pledge, lease, or convey real or personal property, publicly or privately, upon such terms and conditions as may appear to be proper, and to execute all instruments necessary to effect such authority.
. Settle Claims. To compromise, settle, or abandon claims in favor of or against the Trust.
. Manage Property. To manage real estate and personal property, borrow money, exercise options, buy insurance, and register securities as may appear to be proper.
. Allocate Between Principal and Income. To make allocations of charges and credits as between principal and income as in the sole discretion of the Trustee may appear to be proper.
. Employ Professional Assistance. To employ and compensate counsel and other persons deemed necessary for proper administration and to delegate authority when such delegation is advantageous to the Trust.
. Distribute Property. To make division or distribution in money or kind, or partly in either, including disproportionate in-kind distributions, at values to be determined by the Trustee, and the Trustee's judgment shall be binding upon all interested parties.
. Enter Contracts. To bind the Trust by contracts or agreements without assuming individual liability for such contracts.
. Exercise Stock Ownership Rights. To vote, execute proxies to vote, join in or oppose any plans for reorganization, and exercise any other rights incident to the ownership of any stocks, bonds, or other properties of the Trust.
. Duration of Powers. To continue to exercise the powers provided in this Agreement after the termination of the Trust until all the assets of the Trust have been distributed.
. ADDITIONAL TRUSTEE PROVISIONS. These additional provisions shall apply regarding the Trustee.
A. Grantor(s) as Trustee. If at any time the Grantors or either of them shall be acting as Trustee, such Grantor(s)/Trustee may appoint a successor trustee, to become effective immediately or upon any stated contingency, by making such designation in writing. Such designee shall become the successor Trustee upon acceptance of the terms and conditions of this Agreement.
B. Successor Trustee. with bond. without bond. with bond. without bond. with bond. without bond. with bond. without bond. Such designee(s) shall become the successor Trustee(s) upon acceptance of the terms and conditions of this Agreement.
C. Resignation of Trustee. Any Trustee may resign by giving written notice to the beneficiaries to whom income could then be distributed. Such resignation shall take effect on such date specified in the notice, but not earlier than thirty (30) days after the date of delivery of such written resignation unless an earlier effective date shall be agreed to by the income beneficiaries.
D. Adult Beneficiary Rights. If the Trustee resigns or for any reason ceases to serve as Trustee, and if the successor Trustee(s) designated by the Grantors, if any, fail or cease to serve as Trustee, then the adult beneficiaries to whom income could then be distributed, together with the adult beneficiaries to whom principal would be distributed if the Trust were then to terminate, may by majority action in writing appoint a successor Trustee. If agreement of a majority of the beneficiaries cannot be obtained within sixty (60) days, a successor Trustee shall be appointed by the court having general jurisdiction of the Trust. Any successor Trustee appointed shall have all the rights conferred upon the original Trustee and shall be bound by the provisions of this Trust.
E. Accounting. The Trustee shall provide an accounting to the Beneficiary (or beneficiaries) on at least a(n) basis. If a beneficiary has a "disability", the Trustee shall provide the accounting to a guardian or conservator, if any.
F. Bond. Successor Trustees, other than those nominated in this Trust, shall serve
. REVOCATION OR AMENDMENT. Either Grantor may revoke at any time and/or the Grantors may jointly amend, this Agreement by delivering to the Trustee an appropriate written revocation or amendment, signed by the necessary Grantor or Grantors, respectively. If the Trustee consents, the powers of revocation, but not the power of amendment, may be exercised by a duly appointed and acting attorney-in-fact for the Grantors, or either of them, for the purpose of withdrawing assets from the Trust. If the Trust is revoked, the Trustee shall distribute the Trust assets to the Grantors in the same manner and amount as the Grantors contributed the property.
. GOVERNING LAW. This Agreement shall be construed in accordance with the laws of the
. PERPETUITIES SAVINGS CLAUSE. Despite any other provision of this Agreement to the contrary, the Trust created by this Agreement shall terminate no later than 21 years after the death of the last surviving beneficiary of this Agreement who is living at the time of the death of the Surviving Grantor.
. SEVERABILITY. If any portion of this Agreement shall be held to be invalid or unenforceable for any reason, the remaining provisions shall continue to be valid and enforceable. If a court finds that any provision of this Agreement is invalid or unenforceable, but that by limiting such provision it would become valid and enforceable, then such provision shall be deemed to be written, construed, and enforced as so limited.
. MISCELLANEOUS PROVISIONS.
. Paragraph Titles and Gender. The titles given to the paragraphs of this Trust are inserted for reference purposes only and are not to be considered as forming a part of this Trust in interpreting its provisions. All words used in this Trust in any gender shall extend to and include all genders, and any singular words shall include the plural expression, and vice versa, specifically including "child" and "children", when the context or facts so require, and any pronouns shall be taken to refer to the person or persons intended regardless of gender or number.
The Grantors do not have any children at the time of the signing of this Trust. The name of the Grantors' child is .The names of the Grantors' children are .
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Signature: , Grantor 1
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Signature: , Grantor 2
STATE OF
COUNTY OF
DISTRICT OF COLUMBIA
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STATE OF
COUNTY OF
DISTRICT OF COLUMBIA
, having first been duly sworn, did depose and say that he/she is the of , and , having first been duly sworn, did depose and say that he/she is the of , and , and , known to me to be the person described in and who executed the foregoing instrument as Trustee and acknowledged that he/she executed the same (in his/her authorized capacity) as his/her free act and deed.known to me to be the persons described in and who executed the foregoing instrument as Co-Trustees and acknowledged that they executed the same (in their authorized capacity) as their free act and deed.| Notary Address: | ____________________________________ |
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| Notary Address: | ____________________________________ |
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, having first been duly sworn, did depose and say that he/she is the of , and , having first been duly sworn, did depose and say that he/she is the of , and , and , known to me to be the person described in and who executed the foregoing instrument as Trustee and acknowledged that he/she executed the same (in his/her authorized capacity) as his/her free act and deed.known to me to be the persons described in and who executed the foregoing instrument as Co-Trustees and acknowledged that they executed the same (in their authorized capacity) as their free act and deed.
| Notary Address: | ____________________________________ |
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, having first been duly sworn, did depose and say that he/she resides at , , and that he/she is the of , and , having first been duly sworn, did depose and say that he/she resides at , , and that he/she is the of , and , and , known to me to be the person described in and who executed the foregoing instrument as Trustee and acknowledged that he/she executed the same (in his/her authorized capacity) as his/her free act and deed.known to me to be the persons described in and who executed the foregoing instrument as Co-Trustees and acknowledged that they executed the same (in their authorized capacity) as their free act and deed.| Notary Address: | ____________________________________ |
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, having first been duly sworn, did depose and say that he/she is the of , and , having first been duly sworn, did depose and say that he/she is the of , and , and , known to me to be the person described in and who executed the foregoing instrument as Trustee and acknowledged that he/she executed the same (in his/her authorized capacity) as his/her free act and deed.known to me to be the persons described in and who executed the foregoing instrument as Co-Trustees and acknowledged that they executed the same (in their authorized capacity) as their free act and deed.
| Notary Address: | ____________________________________ |
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and and and and , , the of , , , the of , , , the Grantors, , , the Grantors, the Trustee, the Trustees| By: |
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(Trustee)
| By: |
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(Witness)
by , a trustee who is personally known to me or who has produced ______________________________ (type of identification) as identification, by , who is the of , a trustee who is personally known to me or who has produced ______________________________ (type of identification) as identification, by , a trustee who is personally known to me or who has produced ______________________________ (type of identification) as identification, by , who is the of , a trustee who is personally known to me or who has produced ______________________________ (type of identification) as identification, by , a witness who is personally known to me or who has produced ______________________________ (type of identification) as identification, by , a witness who is personally known to me or who has produced ______________________________ (type of identification) as identification, by , a witness who is personally known to me or who has produced ______________________________ (type of identification) as identification, by , a witness who is personally known to me or who has produced ______________________________ (type of identification) as identification, by , a witness who is personally known to me or who has produced ______________________________ (type of identification) as identification, , the Trustee. and , the Trustees. It is recommended (and may be required if real property is included among the trust assets) that these signatures be notarized; however, unlike a will, no witnesses are necessary. However in Florida, a Joint Living Trust must be signed with the same formalities required for the signing of a will. It is recommended (and may be required if real property is included among the trust assets) that these signatures be notarized; however, unlike a will, no witnesses are necessary. However in Florida, a Joint Living Trust must be signed with the same formalities required for the signing of a will.
| _____ | This Joint Living Trust is not valid unless it is signed by the Grantors who are of "sound mind" and of the minimum age for this state. In most states, the minimum age is eighteen. Some states permit an individual below the minimum age to sign a Joint Living Trust if the person is married or in the military. Being of "sound mind" requires that the Grantors each: (a) know that he or she is signing a Joint Living Trust, (b) know the general nature and extent of his or her property, and (c) know the descendants or other relatives that would ordinarily be expected to share in the estate. |
| _____ | The Joint Living Trust should be signed by and in the presence of three DISINTERESTED adult witnesses and a notary public. Many states require only two witnesses, but the signature of a third witness provides some protection against the possibility that one of the witness' signature will be invalid for some reason. For example, a person should not be a witness if that person is a beneficiary under the Joint Living Trust. In most states, if a beneficiary's signature is counted in order to satisfy the minimum number of witnesses, then the Joint Living Trust is not necessarily invalidated, but that "interested witness" may not receive a share of the estate any larger than if the Grantors had died without a trust or will. |
| _____ | All of the witnesses must watch and sign this Joint Living Trust. The Grantors should verbally declare that the document is intended to be their Joint Living Trust, but the witnesses need not read the Joint Living Trust or know of its contents. |
| _____ | Each witness must sign his or her name with the Grantors and the other witnesses present. The witnesses should be satisfied that the Grantors willingly signed the document as their free and voluntary act, and that the Grantors were of full age and sound mind. |
Attachments
| _____ | The Florida Self-Proving Affidavit is a document which should be signed and attached to the end of the Joint Living Trust, and which contains the Grantors' acknowledgment and the affidavit of the witnesses, made before a person authorized to take acknowledgments and administer oaths. The affidavit recites that the requisite formalities were observed in signing the Joint Living Trust. |
| Although attaching the affidavit has nothing to do with the legality of the Joint Living Trust itself, it can speed the admission of the Joint Living Trust to probate (if necessary) after the death of the Grantors because it eliminates the need to have a witness appear at the probate proceeding to testify that the formalities in signing the Joint Living Trust were followed. The witnesses may not be available later when they are needed. A self-proved Joint Living Trust may be admitted to probate without additional witnesses or affidavits, but it is still subject to contest on such grounds as undue influence, lack of testamentary capacity, or prior revocation. |
When to Consult a Lawyer
| * | If the Grantors are unable to sign due to physical disability, another person may be able to sign on behalf of the Grantors, in the Grantors' presence, and at the express direction of the Grantors. However, this document does not provide the necessary language for another person to sign for the Grantors. For assistance with this procedure, a lawyer should be contacted. |
