Asset Protection 102 – The Missouri Qualified Spousal Trust
What in the World is a QST – Qualified Spousal Trust?
As a married man or woman, is protecting your wealth from creditors, predators, lawsuits and bankruptcy important to you? Is it also important to ensure that your wealth is available to you in the event you become disabled? What about your beneficiaries? Do you want your hard-earned assets to be available to them after you pass away?
On May 13, 2011, the Missouri legislature made it easier for you to answer “Yes” and accomplish your goals by creating a “Qualified Spousal Trust.”
A married individual in Missouri who owns property jointly with their spouse maintains some creditor protection from any claims against one of the spouses. The idea is that the marital union combines two separate estates into one, and any assets that are owned jointly as husband and wife are owned 100% by each spouse. If one spouse has issues with creditors, unless that creditor has a claim against both spouses, the property remains protected because that creditor would need a claim against both spouses to have a claim against the property. When one spouse passes away, the surviving spouse becomes the owner of the asset, but all creditor protection is lost at that time.
What happens to your assets owned jointly as husband and wife after the second spouse passes away? Worse yet, what happens if one or both spouses are alive but are disabled? Both these questions can be answered ahead of time by the creation of a basic revocable living trust, but if we transferred our property into a trust, what happened to the creditor protection we had while owning our assets jointly as husband and wife?
Under the new laws passed in Missouri, the creditor protection enjoyed by those individuals owning property jointly as husband and wife is no longer broken by transferring those assets into a revocable living trust, as long as that trust meets the requirements to be a “Qualified Spousal Trust.” Additionally, the qualified spousal trust allows for additional estate tax planning opportunities that were previously more complicated.
If you are a married individual, you owe it to your family to ensure they are protected from creditors, predators, and lawsuits. But they also need to be protected in the event or your death or disability. A Qualified Spousal Trust is a “must consider” strategy for a married individual. However, it is only one of many strategies that should be considered, in addition to business planning and more advanced trust planning. Each client’s needs and goals are unique, and employing a knowledgeable estate planning attorney to guide you through this process is very important.
Call today and make an appointment to find out more about how you can protect and preserve your wealth.
Written by Brian G. Quinn, Attorney with Quinn Estate & Elder Law