I often meet with married couples who believe their assets are automatically protected. They own their Brooklyn brownstone jointly, their investment accounts are in both names, and they assume that if one of them passes away, the other will seamlessly take full ownership. While that’s often true for the first death, it sets up a significant—and often unforeseen—problem for the second.
When the surviving spouse eventually passes, that entire combined estate, now titled in their single name, is headed directly for Surrogate’s Court. This is where a simple assumption can lead to a year or more of probate, expense, and public proceedings for their children. Planning for the first death is only half the equation. A properly structured survivorship trust, also known as a joint trust, is a deliberate act of stewardship that plans for both.
A More Intentional Path Than Joint Ownership
A survivorship trust is a single revocable living trust created by a married couple. During their lifetimes, they both act as grantors and trustees. They transfer their significant assets—real estate, brokerage accounts, business interests—into the name of the trust. In their day-to-day financial lives, nothing changes. They maintain full control.
The trust’s mechanics engage upon the first death. The surviving spouse becomes the sole trustee automatically, without any court intervention. There is no probate, no filing petitions, and no interruption in managing the assets. The trust document dictates what happens next, providing a layer of clarity that simple joint ownership lacks. This continuity is the immediate, tangible benefit.
But the real power of the structure is its foresight. The trust already contains instructions for what happens after the second death. It names the successor trustee who will step in, and it directs how assets are to be distributed to the ultimate beneficiaries—children, grandchildren, or charities. By planning for this second transition, the couple ensures their entire estate avoids probate, preserving the legacy they built together for the next generation.
Beyond Probate: Control and Fiduciary Duty
Avoiding probate is about more than saving time and money. It’s about maintaining privacy and control. Probate proceedings in New York are a matter of public record. A trust administration, by contrast, is a private family affair, handled according to the instructions you leave behind.
The person you name to carry out these instructions, the successor trustee, operates under a strict legal standard. This is not a casual responsibility; it is a profound fiduciary duty. Under New York law, specifically Estates, Powers and Trusts Law (EPTL) § 11-1.7, a trustee’s core obligations cannot be waived. These include the duty of loyalty to the beneficiaries and the duty to act prudently in managing trust assets. This legal framework provides a powerful backstop, ensuring your wishes are honored with the full force of the law.
Stewardship. That is the essence of a trustee’s role. You are entrusting them with your life’s work, and the law holds them to a high standard of conduct.
Is a Survivorship Trust Always the Right Choice?
While powerful, a survivorship trust isn’t the default for every couple. Its simplicity is its strength, but some situations require a different approach.
For high-net-worth families, particularly those with estates approaching or exceeding federal or New York estate tax exemption limits, we might design the trust with more sophisticated provisions. Upon the first death, the trust can be structured to split into two sub-trusts—an “A” trust (the Survivor’s Trust) and a “B” trust (the Bypass or Credit Shelter Trust). The Survivor’s Trust remains revocable and controlled by the surviving spouse. The Bypass Trust becomes irrevocable, preserving the deceased spouse’s estate tax exemption and protecting those assets from being included in the surviving spouse’s taxable estate.
This “A-B” structure is a more complex instrument, but for the right family, it can be a critical tool for preserving generational wealth. We must also consider families with children from previous marriages. A joint trust can be structured to protect the inheritance of all children, ensuring the surviving spouse is cared for while also guaranteeing assets eventually pass to the beneficiaries the first spouse intended.
Finally, a trust is only effective if it is funded. Creating the document is the first step; retitling your assets into the name of the trust is the essential second step. An empty trust avoids nothing. It’s a common and costly oversight we work diligently with our clients to prevent.
A survivorship trust is a foundational tool for married couples who want to create a deliberate and seamless transition for their assets. It’s about looking past the immediate future to establish a clear plan for your spouse and a lasting legacy for your heirs.
The first step in this process is to get a clear picture of what you own and how it is titled. I invite you to schedule a meeting with our firm to perform an asset review, where we can map out your current holdings and discuss whether a joint trust is the right vehicle for your family’s future.
