My parents had an ANB trust. My father never started to be trust when my mom passed away.

Question

So as executor of their trust,  my father, never funded the B trust he lived one year after my mom passed away and during that year, he spent all kinds of money and gave it away so I want to be fair and make sure every beneficiary gets what they’re supposed to, but I am unsure how to separate the money do I do it from the day my mom died or do I just split whatever is in the account now between the ANB trust as each side has different beneficiaries

Julie King · Answer

The accounting would normally start with the value of all assets that existed on the day your mother died. But, if there are no step-siblings (children from other marriages or relationships) then, in many cases, all of the children can agree in writing to avoid the forensic accounting and split the assets the way a trust or will says it should be split. If your parents left assets valued at $184,500+ and neither parent left a trust, you may have to go through a court process called probate before any bank will release funds to anyone. Banks insist on seeing a trust, will, affidavit or even a court order before releasing funds to any random relative who gets to the bank first. I hope this helps!

James L. Arrasmith · Answer

In California, an A-B trust is designed to minimize estate taxes and manage the distribution of assets to beneficiaries. When one spouse passes away, the trust is typically divided into two sub-trusts: the Survivor's Trust (A) and the Decedent's Trust (B). The failure to fund the B trust after the first spouse's death complicates the situation, especially if assets were spent or given away by the surviving spouse. 
 
The division of assets between the trusts should ideally have occurred upon the first spouse's death, based on the terms outlined in the trust agreement and the value of the estate at that time. Since this did not happen, determining how to equitably divide the remaining assets can be challenging. The goal is to respect the intent of the trust creators as closely as possible, considering the assets' value at the time of the first spouse's death and any subsequent changes in value or asset depletion by the surviving spouse. 
 
Consulting with a legal professional experienced in trust and estate administration is crucial to navigate this complex situation. They can help interpret the trust's terms, evaluate the estate's current status, and recommend a course of action that aims to distribute the assets fairly among the beneficiaries. Given the unique circumstances of your case, including the depletion of assets by the surviving spouse, the solution may require a careful analysis of the trust's provisions, the estate's value at key moments, and any applicable California laws.

Q: My parents had an ANB trust. My father never started to be trust when my mom passed away.