AB Trust

The AB Trust is popular form of a Revocable Living Trust (“RLT”). The AB Trust can currently zero-out transfer taxes by directing the trustee to fund a B trust (or "family trust") with the lifetime exemption of the first spouse to die and then having the trustee use the exemption of the surviving spouse to reduce taxes at the second death. The trust can be designed with various incentive trust clauses to motivate heirs. A properly funded AB trust will reduce or eliminate probate costs and hassles.