In the past few decades, cultural norms and expectations have shifted as around half of all marriages end in divorce. This means that blended families are no longer a rare exception in Los Angeles. It is not uncommon for an individual to marry, have children, divorce and then remarry another individual. When it comes to estate planning, it is usually important to a person in a similar set of circumstances to provide for both their surviving spouse as well as their children.
One method of providing for a surviving spouse as well as children from a previous marriage is to set up a qualified terminable interest property trust. In such a scenario, in accordance with tax law, the surviving spouse would inherit all income for the trust each year, but then upon the death of the surviving spouse, children from a first marriage would get the assets rather than the surviving spouse dictating where the trust would go upon their death. This type of arrangement can be set up through a will.
Further, in this type of arrangement, tax is not due on the estate until the surviving spouse passes on, because the children would be the ultimate heirs. However, this is not the only option available in cases where an individual wishes to be able to provide for both a second spouse and children from a previous marriage or relationship.
Further, it isn't simply individuals with blended families that can benefit from estate planning. The options and arrangements for providing for beloved family, friends and organizations after an individual's passing are available in a variety of manners in Los Angeles. The complexities and tax implications involved in estate planning can be confusing. Often, speaking with experienced legal counsel can guide an individual in the best manner for providing for those closest to them at the end.
Source: CNBC, "Yours, Hers, and the Kids': Estate Planning After Remarrying," Charles DeLaFuente, Oct. 19, 2012
