[WSBAPT] Looking for solutions

[Joshua McKarcher]

Anna,

I'm going to assume all assets are community; the decedent's retirement assets are thus community; the surviving spouse signed off on this primary gift to the trust (as the relevant custodian's form would surely have required); the child is both of theirs; the retirement assets are not required to leave the surviving spouse with "survivor's trust" assets at least equal to her half of the combined estate's value; and that the mother and child get along well.

If so, it seems possible the child could take the blasted thing and pay kiddie tax on distributions -- which will be roughly the same outcome as if mother received distributions; the distributions could be directed to a custodial account of which mother is custodian; she could use those funds to pay as many expenses for the child as reasonably defensible (college and first car and medical expenses and insurance premiums and sports physicals (you get the point)); and she could use non-retirement assets to pay expenses not defensibly payable from the custodial account.

Is it wonderful? Probably not. Is it better than appointing a GAL for the child who might be hard pressed to consent to a nonjudicial agreement to divest the child of this inheritance (or whatever else would be sought in litigation)? Probably.

Are there potential risks? Probably. But could it work and the child turn 18 and be understanding and disinclined to sue his or her own mother so long as she didn't spend the custodial account funds on the stereotypical new spouse or lover? I would think so.

What a wild little situation you've happened upon. Mercy.

If there is even a nugget of possibility above, great. If another of our amazing colleagues responds to point out errors in my 11 pm brainstorming, accept my apologies in advance.

Best, Josh


Joshua McKarcher

Attorney, Owner
McKarcher Law PLLC
o: (509) 758-3345
josh at mckarcherlaw.com<mailto:josh at mckarcherlaw.com>

[signatureImage]

________________________________
From: wsbapt-bounces at lists.wsbarppt.com <wsbapt-bounces at lists.wsbarppt.com> on behalf of Anna Van Pelt <anna at vanpeltlegal.com>
Sent: Monday, May 25, 2026 5:03 PM
To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
Subject: [WSBAPT] Looking for solutions

I hope everyone had a good three-day weekend, and I’m the only trying to get a jump on this week… I have a sad situation and I think I’m looking for an attorney to help the trustee start a TEDRA, but I’m open to other creative solutions too.

I’m administering a joint RLT after the death of the first spouse. In their meeting with the attorney who drafted the trust (not me), the client heard that “everything should be left to the trust.” They set the trust as the primary beneficiary of their retirement accounts, not each other. Unfortunately, the trust says that any retirement accounts with the trust as the beneficiary flow into a conduit (not accumulation) trust for their children, totally bypassing the surviving spouse. There is a surviving spouse, and one child, who is 13 years old. Surviving spouse is, understandably, upset because she understood that to be money that would be available to her, and it seems likely that this was not the intent (or even the understanding) of the decedent when he signed the trust and updated his beneficiaries.

Options? If others have fixed similar problems, I’d love to hear from you.

We are also under a time crunch because the deceased spouse’s trust is a QTIP unless property is disclaimed, and then it goes into a credit shelter trust. However, if the retirement accounts won’t be part of the surviving spouse’s estate, then the surviving spouse is clearly under the current WA state estate tax exemption, and she won’t need the credit shelter.

Thanks,
Anna


Van Pelt Law
(206) 635-7250
www.vanpeltlegal.com<http://www.vanpeltlegal.com/>
Pronouns: She/Her

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