A/B Trust Planning Strategy For Texans

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Last Updated: Nov 14, 2024

Read Time: 4 mins

When it comes to securing your family’s financial future, estate planning is a key component as a Katy, TX revocable living trust lawyer can share. For married couples in Texas, A/B Trust planning is an effective strategy to minimize estate taxes and ensure smooth asset distribution. With the guidance of Attorney Stuart A. Green, who serves clients across Texas since starting his own firm in 2021, you can understand why this approach is particularly vital in 2024.

Why A/B Trusts Are Essential In 2024

In 2024, the federal estate tax exemption is set at $13.61 million per individual. This means each person can pass on up to $13.61 million without incurring federal estate taxes. For married couples, this amount doubles to $27.22 million. However, the Tax Cuts and Jobs Act (TCJA) of 2017, which temporarily increased these exemptions, will sunset in 2026. At that point, the exemptions are expected to revert to lower amounts, making it crucial to consider A/B Trust planning now.

Understanding A/B Trusts

A/B Trust planning involves splitting the estate into two separate trusts upon the death of the first spouse:

• Trust A, also known as the survivor’s trust, is controlled by the surviving spouse. They can use the assets in this trust as they wish.

• Trust B, or the bypass trust, holds the deceased spouse’s share. The surviving spouse can benefit from the income generated by Trust B but does not have control over the principal assets. These assets eventually pass to the beneficiaries, typically the children, upon the death of the surviving spouse.

Benefits For Texas Residents

Texas residents can particularly benefit from A/B Trust planning. Here’s how:

• Maximizing Estate Tax Exemptions: By dividing the estate, each spouse can fully utilize their individual exemption. Trust B makes use of the deceased spouse’s exemption, reducing the taxable estate for the surviving spouse.

• Protecting Assets: Trust B provides a layer of protection from creditors and ensures that the assets are managed according to the deceased spouse’s wishes, safeguarding the inheritance for the beneficiaries.

• Flexibility And Security: While Trust B is irrevocable, the surviving spouse can still benefit from its income, ensuring financial stability without compromising the protection of the principal assets.

Taking Action In 2024

With the potential reduction in estate tax exemptions looming in 2026, 2024 is an opportune time for Texas couples to consider A/B Trust planning. Attorney Stuart A. Green, based in Houston, specializes in guiding clients through this process, ensuring that their estate plans are optimized to minimize future tax liabilities.

Steps To Implement A/B Trust Planning

To effectively utilize A/B Trusts, it is essential to:

• Consult with an experienced estate planning attorney, like Stuart A. Green, who can tailor the plan to your specific needs and circumstances.

• Understand the structure and function of Trusts A and B, including the limitations and benefits for the surviving spouse and eventual beneficiaries.

• Prepare the necessary legal documents to establish the trusts, ensuring compliance with Texas laws and federal tax regulations.

Ensuring A Secure Future

Estate planning is about more than just minimizing taxes; it’s about providing for your family’s future. A/B Trusts offer a strategic way to protect your assets and ensure they are distributed according to your wishes. With the estate tax exemption currently at $13.61 million and the anticipated changes in 2026, now is the time for Texas residents to act.

Attorney Stuart A. Green in Houston, Texas, is dedicated to helping clients across the state navigate the complexities of estate planning. By considering A/B Trust planning in 2024, you can take advantage of the current estate tax laws and safeguard your family’s financial future. Reach out to Stuart Green Law, PLLC to learn more about how A/B Trusts can benefit you and your loved ones in Texas; he is licensed in Texas, Kentucky, Pennsylvania, and South Dakota.

The Stuart Green Law Approach

A Modern Approach to Family Wealth

Stuart Green Law combines modern South Dakota trust law with integrated estate planning, wealth management, and fiduciary services for families throughout the United States and internationally. The firm’s approach is built around selecting the strongest legal framework available, maintaining continuity of planning judgment, and bringing every part of the family’s wealth strategy into alignment with its long-term objectives.

South Dakota Law,
Wherever You Live

Families are not limited to the trust laws of their home state. Stuart Green Law integrates South Dakota’s sophisticated legal framework into estate plans for clients across the United States and around the world, allowing families to benefit from its privacy, flexibility, asset protection, and long-term trust advantages regardless of where they live.

Direct Advisory
Relationships

Stuart Green Law is intentionally structured as a boutique practice. Clients work directly with the attorney responsible for their planning, creating continuity of judgment and a deeper understanding of the family’s objectives as the plan evolves over time.

Planning That Works
as One System

Estate planning, tax strategy, wealth management, and fiduciary services are most effective when they operate together. Stuart Green Law integrates these disciplines into a cohesive framework that keeps the family’s wealth aligned with the grantor’s vision, goals, and long-term planning intent.

Client Testimonials

    
 
 
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   Angélique Pfab Green 
 
 
 
 Trustindex verifies that the original source of the review is Google. Stuart Green is incredibly knowledgeable and clearly operates at a very high level. His approach to estate planning and wealth strategy is thoughtful, modern, and well beyond the traditional. You can tell he genuinely cares about helping people protect what they’ve built. Truly impressive work and reputation.
  
 
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   Maria Cardenas Anderson 
 
 
 
 Trustindex verifies that the original source of the review is Google. I had an excellent experience working with Stuart Green on my trust and will documents. From start to finish, he was incredibly responsive, patient, and thorough. He took the time to explain everything clearly, ensuring I fully understood each step of the process. Even after the trust was complete, he guided me on what still needed to be done — something I really appreciated. Stuart’s professionalism and kind demeanor made what could have been an overwhelming experience so much easier. I felt informed and supported every step of the way. I would highly recommend him to anyone looking for a knowledgeable and attentive probate lawyer. Thank you, Stuart!
  
 
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   katelyn rennie 
 
 
 
 Trustindex verifies that the original source of the review is Google. Stuart is outstanding! We have been so impressed with his knowledge.
  
 
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   Chris Stinson 
 
 
 
 Trustindex verifies that the original source of the review is Google. Stuart Green is an exceptional estate attorney. He handled my father's living will and then his estate after his passing, as well as helping my mother finalize and complete her estate in conjunction with my father's death. Currently, he is handling the living will and estate planning for me and my wife and our family. I highly recommend him and his integrity of work.
  
 
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   Alejandra 
 
 
 
 Trustindex verifies that the original source of the review is Google. My experience with Stuart Green Law was a 10/10. They were professional and efficient, resolving my case quickly. I highly recommend them!
  
 
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   Joseph Marchetti 
 
 
 
 Trustindex verifies that the original source of the review is Google. Great guy - honest businessman.  Has been very helpful for me in providing feedback and input from a law perspective on employment and legal agreements in my personal and professional life.  Would heartily recommend Stuart to others!
  
 
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   Will Desrochers 
 
 
 
 Trustindex verifies that the original source of the review is Google. I have worked with Mr. Green for awhile now and can't recommend him highly enough. He is professional and and timely with his responses to my questions. I really appreciate how he helps me understand the plan for my estate. I look forward to continuing to work with him.
  
 
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   Chuma 
 
 
 
 Trustindex verifies that the original source of the review is Google. I’ve learned a great deal from Stuart on the foundational aspects of estate planning, legacy planning and asset protection. Having had the privilege  to work alongside Stuart, I can also say that he is a top tier counselor and focused on aligning his client’s personal goals with their long term objectives and wishes.
  
 
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   Nick Delsignore 
 
 
 
 Trustindex verifies that the original source of the review is Google. Incredible person to know and be associated with. Stuart provides excellent services, that is undeniable. However you will be hard pressed to find another attorney with a truer moral compass.