In California, a joint revocable trust can be one of the most effective estate planning tools for married couples. At the Kushner Legal Corporation, we often meet with couples who have not completed a joint estate plan and we encourage them to consider a joint revocable trust. Not only does it streamline the administration of a couple’s estate, but it also reduces potential costs, protects privacy, and can prevent unnecessary legal complications. Understanding how joint revocable trusts work and how they interact with California probate laws is crucial for couples who want to protect their legacy and simplify matters for their loved ones.

What Is a Joint Revocable Trust?

A joint revocable trust is a legal arrangement in which both spouses serve as co-settlors and typically as co-trustees of a single trust. They contribute their community and separate property into the trust, retain full control over the assets during their lifetime, and have the ability to amend or revoke the trust at any time. Upon the death of one spouse, the trust may become partially irrevocable, depending on its terms, and allows for a seamless transition of control to a successor trustee.

Avoiding Probate with a Joint Trust

One of the most well-known advantages of a revocable trust is its ability to bypass probate. In California, the probate process can be lengthy and expensive. According to California Probate Code Section 10810, attorney’s fees in probate are based on a statutory fee schedule tied to the gross value of the estate, not the net value. For example, the probate of a $1 million estate could cost $23,000 in attorney fees alone, not including executor fees, filing fees, and other costs.
Assets placed in a joint revocable trust avoid this process entirely. When one spouse dies, the surviving spouse can continue managing the assets without court intervention. When the second spouse passes, the named successor trustee can distribute the assets directly to beneficiaries without having to go through probate.

Simplified Management During Incapacity

A joint trust provides built-in protections in case one spouse becomes incapacitated. The other spouse, as co-trustee, can continue managing all assets held in the trust without delay. There is no need to petition the court for a conservatorship, which can be invasive and time-consuming. This is particularly important in California, where conservatorship proceedings can be expensive and subject to strict court oversight.

In addition, California Probate Code Section 2101 outlines the duties of conservators, and the process involves detailed accountings and reports. A joint revocable trust allows couples to avoid this process altogether, as the trust will include provisions for incapacity and successor management.

Community Property and Step-Up in Basis

California is a community property state. When married couples hold assets in a properly drafted joint revocable trust that acknowledges community property character, both halves of the property may receive a full step-up in basis upon the first spouse’s death. This can significantly reduce capital gains taxes if the property is later sold by the surviving spouse or beneficiaries.

To take advantage of this, the trust must be drafted to clearly identify community property versus separate property. This distinction helps ensure the full step-up applies under IRS rules and California tax guidelines. A trust that properly allocates these interests also reduces potential disputes among heirs.

Privacy and Continuity

Unlike a will, which becomes a public document upon death, a trust remains private. This means that the details of your estate, including what assets you own and to whom they are distributed, are kept confidential. Privacy can be especially important for high-profile individuals or couples with complex family dynamics.

Further, a joint trust ensures continuity. There is no interruption in asset management when one spouse dies. The trust seamlessly continues for the surviving spouse, and then for the next generation, allowing for efficient, private, and orderly management of the estate.

Final Thoughts

For married couples in California, a joint revocable trust is more than just a legal document. It is a tool that provides control, clarity, and protection. By avoiding probate, reducing taxes, ensuring privacy, and planning for incapacity, a joint trust offers peace of mind and financial efficiency.

Contact the Kushner Legal Corporation today to schedule a consultation.