Structuring Joint Trusts in Separate Property States to Avoid Income and Gift Tax Pitfalls

Identifying "Problem" Assets, Coordinating JRTs With Credit Shelter Trusts, Drafting GPOAs, and More

A live 90-minute CLE/CPE webinar with interactive Q&A

Tuesday, May 23, 2017
1:00pm-2:30pm EDT, 10:00am-11:30am PDT

Early Registration Discount Deadline, Friday, April 28, 2017

This CLE/CPE webinar will provide estate planners and advisers with a thorough and practical guide for utilizing joint trusts in separate property/common law states. The panel will outline the situations in which to use joint marital trusts and where to steer clear. The webinar will identify specific tax traps to avoid and will offer specific drafting language to maximize the benefits and minimize the risks of using joint marital trusts in common law states.


The question of whether to utilize a joint marital trust in a state that does not default to community property law is one that can present both risk and reward. For couples in certain situations, separate trusts are generally more advisable; however, for many couples, setting up a joint trust is their preferred vehicle for wealth planning. There are specific tax pitfalls estate planning counsel must avoid when structuring joint trusts in separate property states.

Navigating the gift tax consequences is critical when setting up a joint trust in a separate property state. In circumstances where the spouses contribute unequal amounts, the funding of the trust could trigger a gift tax consequence if the trust instrument does not properly assign the power to revoke or withdraw assets.

There are also income tax risks in structuring a joint trust in a separate property state. Most of these issues can be avoided through careful drafting of the trust document, but estate planners must be prepared to identify and manage these hidden tax risks.

Listen as our experienced panel provides thorough and practical guidance to structuring a joint trust to operate in a separate property/non-community property state.


  1. Tax and non-tax considerations for utilizing a JRT in a separate property state
  2. Gift and estate tax issues to avoid in funding and administering a JRT in a separate property state
  3. Income tax issues and potential advantages of JRTs
  4. Drafting recommendations and resources


The panel will review these and other key issues:

  • What are the gift tax risks to utilizing a joint revocable trust in a separate property state?
  • What “problem” assets require special attention when used to fund a joint revocable trust?
  • Coordinating joint revocable trusts with credit shelter trusts
  • Drafting general power of appointment in JRTs in non-community property states

Learning Objectives

After completing this course, you will be able to

  • Decide when counsel should recommend using a joint marital trust sited in a separate property state, based on client circumstances
  • Determine how to structure the trust to avoid gift tax consequences, both at the time of funding and settlement
  • Recognize other possible adverse tax events, including income tax recognition requirements, that may arise from funding a joint marital trust in a separate property state
  • Identify non-tax considerations for utilizing a joint trust in a non-community property state
  • Discern useful drafting language to ensure that the trust is structured in a tax-efficient manner


Lauren Evans DeJong, Of Counsel
Stahl Cowen Crowley Addis, Chicago

Ms. DeJong counsels individuals with regard to estate planning, estate and trust administration, asset protection and tax and business planning. She works with individuals and their families in areas related to transferring and preserving wealth, business succession, planning for disability, special needs and health care coverage. She also represents clients in connection with probate, trust and guardianship proceedings and before the U.S. Tax Court with regard to federal tax matters. In the corporate arena, she counsels closely held businesses and start-ups in the areas of entity formation, organizational and strategic planning, and contract drafting.

Scott K. Tippett, Atty
The Tippett Law Firm, Oak Ridge, N.C.

Mr. Tippett's practice focuses on wealth law, as a comprehensive and integrated approach to domestic and international estate planning, asset protection planning, business matters, and tax issues. He is the principal author of The North Carolina Wealth Law Counselor and The Wealth Lawyer, informative blogs dedicated to wealth law, estate planning, and asset protection planning issues.

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This webinar is eligible for at least 1.5 general CLE credits.

CLE credits are not available for PR.

*In KS, OH, PA, for more than 1 attendee on the connection you must contact Strafford CLE via email or call 1-800-926-7926 ext. 35 prior to the program for special instructions.

CPE on Live Event

Continuing Professional Education credit processing is available for an additional fee per person. You may register for CPE credit processing at any time before or after the program. To qualify for CPE you may not listen via the telephone.

This program is eligible for 1.5 CPE credits.

  • Field of Study: Taxes.
  • Level of Knowledge: Intermediate.
  • Advance Preparation: None.
  • Teaching Method: Seminar/Lecture.
  • Delivery Method: Group-Internet (via computer).
  • Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of verification codes announced throughout the presentation.
  • Prerequisite: Three years+ business or public firm experience at mid-level within the organization, involved in estate planning and structuring wills, trusts and other estate documents, and supervising other estate planners/attorneys. Specific knowledge and experience with structuring both separate and joint marital trusts; specific knowledge of gift tax rules; familiarity with estate structures for separate property states; familiarity with spousal tax considerations involved in trusts, and income tax implications of contributions of trust assets.

NOTE: CPE credit processing for all attendees must be ordered by 2pm Eastern the day of the program to receive a Certificate of Attendance within 24 hours.


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