When blended families in Georgia need to create an estate plan, they need to consider a few unique factors. A simple will may not be adequate enough to protect assets for biological children or fulfill other objectives. Trusts, however, are very flexible legal tools that can be adapted to complicated situations involving ex-spouses, stepchildren, and multiple divorces. There are many different options available.
A common type of trust for blended families is one that gives assets to a current spouse during their lifetime and then passes these assets on to biological children upon the spouse’s death. This as known as an AB trust. In an ABC trust, assets are divided and distributed to a set of other trusts that each have their own set of rules and objectives. At one time, these types of trusts were used to avoid estate taxes, but they now play an important role with blended families.
Choosing a type of trust is just one step of the planning process for families. It’s very important to pick the right trustee as there is a high likelihood of disagreements between new spouses and biological children. The trustee will need to be a neutral party who can set emotion aside and carry out the objectives of the trust as the grantor intended.
Blended families with complex objectives for their estate planning might benefit from the support and guidance of an attorney. A lawyer may be able to work closely with a client to discover what type of trust is appropriate and make sure that trust is drafted in a way that’s upheld in court. Lawyers might also help families amend wills and trusts when circumstances change or when laws change the structure of the state or federal tax code.