Revocable Joint Trust for Married Couple
(Marital QTIP, Family Trust, and GST Tax Planning) (WA)

Summary

This template is a joint revocable trust for use in Washington by a married couple with a taxable estate. It contains a marital trust and a family trust. This template includes practical guidance, drafting notes, and alternate and optional clauses. Using this template requires joint representation of spouses; however, prior to doing so you must ensure joint representation is appropriate and does not violate the Washington Rules of Professional Conduct. Joint representation requires advanced informed consent and waiver of the limitations of joint representation, including the following: • Counsel cannot consult separately with one jointly represented client about that client's best interests unless it is also in the best interest of the other jointly represented client. • There is no confidentiality between one jointly represented client and counsel, and all matters disclosed by one jointly represented client must be shared with other jointly represented client. • Counsel cannot make claims between jointly represented clients or advise a jointly represented client about a claim that client may have against the other. • In the event a conflict arises during joint representation, counsel must withdraw, and the clients must obtain new and separate counsel. See Wash. RPC 1.7. The trust creates a marital trust and a family trust at the first spouse's death. If the trusts are funded and administered properly, there should be no Washington state estate tax or federal estate tax due at the first trustor's death. The trust also includes a provision authorizing the personal representative of the deceased trustor's estate to qualify the marital trust assets as qualified terminable interest property (QTIP) to take advantage of the marital deduction. There are several advantages to including a QTIP trust provision in an estate plan, such as (1) providing the personal representative with the flexibility to determine the extent of the QTIP election, (2) the possible opportunity to achieve a step up in basis, (3) the ability to control the distribution of assets at the death of the surviving trustor, and (4) the avoidance of estate taxes. A trust with a QTIP trust is generally best suited for taxable estates or those likely to file an estate tax return for federal portability because the personal representative must affirmatively elect to qualify any or all of the marital trust as a QTIP trust. Note that Washington state does not have or incorporate the federal provisions of portability for its estate tax. After the death of the surviving trustor, the trustee continues to hold the trust assets for the benefit of the trustors' children through the age of 25. The trustee may make distributions of principal and income to the trustors' children with flexibility to favor beneficiaries with greater financial needs. When the youngest child reaches 25, the trustee divides the remaining trust assets into equal shares in shares for each child granting each beneficiary the option of requesting certain shares of trust principal at ages 25, 30, and a final distribution at age 35. Descendants of a deceased child take that deceased child's share. A revocable trust (also known as a "living trust" or "inter vivos trust") is typically used as a will substitute to avoid probate. The revocable trust also includes elements of disability planning, as assets can be managed by the successor trustee without an adjudication of incapacity. However, because the trustors retain power over the trust assets, revocable trusts do not provide asset protection. In addition to the creation of the trust, the trustors will need to fund the trust in order avoid probate. To assist your clients with funding, provide them with a checklist or letter to help them understand the additional action required to coordinate the estate plan beyond executing the documents. For a letter to a client regarding the importance of funding a revocable trust, see Letter to Client (Funding of Revocable Trust) (WA). Properly drafting and funding a trust is a multi-step process and the trust agreement is just one of the important components. To ensure that the decedent's assets are properly transferred to the intended beneficiaries, a revocable trust should be used together and coordinated with a pour-over will. See Will for Individual with Spouse or Partner (Pour Over to Inter Vivos Trust) (WA). Use of such a complex trust is generally limited to situations in which the value of the couple's aggregate assets exceeds the federal estate tax exclusion amount ($13,990,000 per individual and $27.98 million per married couple in 2025) or the Washington state estate tax exclusion amount ($2,193,000 per individual) and the couple wants to defer any estate tax until the death of the survivor. For a more basic revocable trust for a married person, see Revocable Trust for Individual with Spouse or Partner (Separate Share Trusts for Children) (WA). For an in-depth discussion of the estate tax marital deduction, see Marital Deduction.