Revocable Trust for Individual with Spouse or Partner
(Pot Trust for Children) (MD)

Summary

This template is a complete revocable trust for use by an individual with a spouse or partner in Maryland. It contains provisions for the creation of a common share or pot trust for the benefit of the individual's children. This template includes practical guidance, drafting notes, and optional clauses. This template provides for the residuary trust estate to pass outright to the surviving spouse or partner upon the settlor's death. If there is no surviving spouse or partner, the trust assets pass to the settlor's children. If one or more of the settlor's children are under a specified age, their shares pass to a common share or a pot trust. A pot trust may be desirable if the trustor wants to provide for their children in a way that addresses each child's particular needs, as opposed to giving fixed fractions to each child outright or in separate trusts. A pot trust allows the trustee to treat younger surviving children much as the parents would have if providing for those children during the parents' lifetime, since parents often provide for their children in ways that may not be entirely equal for a variety of reasons. For example, one child might attend an expensive private college and another child might attend a less expensive private college. Or perhaps one child was born many years after another child, and so may not have the same sorts of financial needs as the older child. This template provides for one stage of payouts but can be modified to provide for additional stages. All distribution provisions should be carefully crafted to reflect the client's wishes. 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 settlor retains power over the trust assets, revocable trusts do not provide asset protection or estate tax savings. In addition to the creation of the trust, settlors will need to fund the trust with all of their individually owned assets in order to avoid probate. To assist clients with funding, once they give you a completed questionnaire, you should provide a checklist and/or letter to help them understand the additional action required to coordinate the estate plan beyond executing the documents. This includes, for example, recording new deeds for real property, updating beneficiary designations with investment, retirement, checking, and savings accounts, and more. To ensure that all of the settlor's assets are properly transferred to the intended beneficiaries, a revocable trust should be used together and coordinated with a pour over will. For a pour over will template that can be used in Maryland, see Will for Individual with Spouse or Partner (Pour Over to Inter Vivos Trust) (MD). For a revocable trust that can be used for a single individual, see Revocable Trust for Single Individual (Pot Trust for Children) (MD). For a basic revocable trust, see Revocable Trust for Individual with Spouse or Partner (Basic) (MD).