This post contains Articles Nine of a sample living trust agreement. This video explains the purpose of the Credit Shelter Trust.
Our Trustee shall hold and administer the Non-Marital Share in a separate trust as provided in this Article. This document refers to the trust as the Credit Shelter Trust.
The surviving Grantor is the only beneficiary of the Credit Shelter Trust during the surviving Grantor’s lifetime.
Our Trustee shall distribute all of the net income of the Credit Shelter Trust to the surviving Grantor at least semi-annually during the surviving Grantor’s lifetime.
Our Independent Trustee may distribute as much of the principal of the Credit Shelter Trust to the surviving Grantor as our Independent Trustee may determine advisable for any purpose. If no Independent Trustee is then serving, our Trustee shall distribute as much principal to the surviving Grantor as our Trustee determines necessary or advisable for the surviving Grantor’s health, education, maintenance or support.
The surviving Grantor is the only beneficiary of the Credit Shelter Trust. In making discretionary distributions under this Article, our Trustee should bear in mind that our primary concern and objective is to provide for the well-being of the surviving Grantor, and the preservation of principal is not as important as this objective.
Without limiting our Trustee’s discretion, we recommend that our Trustee not distribute principal from the Credit Shelter Trust to the surviving Grantor until the principal of the Survivor’s Trust is substantially exhausted.
The Credit Shelter Trust will terminate upon the death of the surviving Grantor and our Trustee shall administer the balance or remainder of the Credit Shelter Trust as provided in Article Ten.