Understanding Estate Taxes
10. Living trust with tax planning (B)
However, as shown here, Sue can receive income from Bob's trust, and she can withdraw principal from it if needed for her health, education, maintenance and support. So, although she cannot have complete control over Bob's trust, the assets can provide for Sue for as long as she lives.
There is another benefit you may be interested in, even if your estate isn't large enough to worry about estate taxes-and that's control.
As soon as Bob dies, his trust becomes irrevocable. This means his instructions cannot be changed by anyone. So, even though he dies first, he keeps control over who will receive his share of the estate after Sue dies.
This could be important to Bob if he has children from a previous marriage. Or, he may want to make sure that, if Sue later remarries, his part of the estate doesn't end up with Sue's new husband.
By the way, this same kind of tax planning can be done in a will, but you would not avoid probate or get the other benefits of a revocable living trust.