The purpose of a trust is to hold assets outside of one’s estate. In divorce, assets held in a trust must be characterized as belonging to the couple (community property) or to one of the spouses (separate property). That characterization can have significant divorce implications, with regard to property division and spousal support.Schoenberg Family Law Group, P.C., handles high net worth divorces throughout the Bay Area, including the disposition of trust assets within property settlements. We successfully protect family trust wealth and trust funds on our clients’ behalf. On the other side of the issue, we also empower clients to “break” trusts that were improperly used to avoid community property obligations.
Family Trusts And Trust Funds In Division Of Property
Many couples create revocable living trusts (i.e., family trusts) during marriage, to manage their wealth and arrange for bequests to their heirs or a charity. In divorce, such a trust is presumably community property to be divided in half, unless one spouse can present a convincing argument that it should be characterized as separate property.
On the other hand, there is a presumption of separate property when a spouse is the beneficiary of a trust fund, when the spouse owns assets in a family trust from a previous marriage, or when a prenuptial agreement declares trust assets to be separate. However, these are rebuttable presumptions, and our experienced attorneys can assess the strength of the California law presumption against any given asset.
Even when trust assets are deemed separate property, the spouse may be entitled to a community property share of the appreciation in value during the length of the marriage, even if the trust is the subject of a premarital or postmarital agreement. Our lawyers can address these issues, as well as tax implications of trust assets, transmutation of trust assets, and other claims and disputes that may alter the property settlement.
“Debra and her team were always very respectful and mindful of my financial situation and handled my divorce in a cost-effective and caring manner. Debra and [her associate] did everything possible, and succeeded in fostering an uncontentious, amicable environment at the least possible expense, while absolutely protecting my interests.”
— A.G. (We invite you to see more client testimonials.)
Proper Consideration Of Trusts
Schoenberg Family Law Group, P.C., concentrates exclusively on family law. We are committed to protecting your properly preserved trust assets, or securing your fair share of marital assets tied up in a family trust.
To speak with our San Francisco divorce lawyers about assets in trust, contact us online or call us at 415.834.1120.