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Divorcing a Trust Fund Beneficiary .
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Divorcing a Trust Fund Beneficiary

When considering divorce that involves a trust fund beneficiary it is important to have an understanding of how trust law works. In trust law, the person entitled to the benefit of the trust arrangement is considered the beneficiary.

To prepare when divorcing a trust fund beneficiary, keep in mind the following:

• Assets placed in a trust before marriage are usually treated as separate property.
• The trust protects the estates because once it was established; the trust then legally owns the property, nether the owner, nor the filing spouse.
• If an estate planning attorney is involved, their job will be to protect the trust beneficiary because it is their job to protect the wealth of the beneficiary
• Support and discretionary trusts can be used to protect the beneficiary and stop disbursements during a divorce
• If the trust beneficiary has no power to access or distribute the trust funds, they can be left penniless
• A family court judge may consider regular trust disbursements as income for purposes of calculating child and spousal support
• The spouse and the estate planning attorneys may be able and willing to negotiate a prenuptial, postnuptial or divorce agreement

There can be a fair amount of money involved when divorcing a trust fund beneficiary, and in many cases the trust beneficiary will spare no expense to protect their funds. In California, the family court’s authority to order the payout of unrestricted, support and spendthrift trust funds in divorce is limited. Due to the nature of the laws governing the marriage and divorcing of a trust beneficiary being so complicated, it’s important to speak with an experienced family law attorney to understand such a case.

Contact Thorsteinson Law Group to help you with your divorce. We provide complimentary consultations, and are dedicated to helping you through the divorce process.

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