Glossary of Terms

Separate Property

Generally, all assets you acquire prior to marriage and assets acquired by gift or inheritance during marriage.

Separate Trust

A trust established by one person. A married couple has separate trusts if each spouse has his/her own trust with its own assets. In contrast, see "Common Trust."

Settle an Estate

The process of handling the final affairs (valuation of assets, payment of debts and taxes, distribution of assets to Beneficiaries) after someone dies.

Settlor

See "Grantor."

Special Gifts

A separate listing of special assets that will go to specific individuals or organizations after your incapacity or death. Also called special bequests.

Special Needs Trust

Allows you to provide for a disabled loved one without interfering with government benefits.

Spendthrift Clause

Protects assets in a trust from a beneficiary’s creditors.

Spouse

Husband or wife.

Stepped-up Basis

Assets are given a new basis when transferred by inheritance (through a will or trust) and are re-valued as of the date of the owner’s death. If an asset has appreciated above its basis (what the owner paid for it), the new basis is called a stepped-up basis. A stepped-up basis can save a considerable amount in capital gains tax when an asset is later sold by the new owner. Also see "Basis."

Subchapter S Corporation Stock

Stock in a corporation which has chosen to be subject to the rules of subchapter S of the Internal Revenue Code.

Surviving Spouse

The spouse who is living after one spouse has died.

Survivor’s Trust

See "A Trust."

Successor Trustee

Person or institution named in the trust document who will take over should the first trustee die, resign, or otherwise become unable to act.