So I received my monthly alimony check and noticed that this time, the check said "Ex-husband's last name family trust" And the line below said "Ex-husband's new wife's name, trustee".
Now I'm wondering what the purpose or benefit of him having a trust is? We live in a community property state (hopefully he got a pre-nup before marrying his much younger wife but he may not have.) To the best of my knowledge, his assets consist of about $500k in 401k/Keogh retirement funds, the duplex he owns and lives in (Probably worth $1.5 - 1.8 million with maybe $600k-800k in mortgage owed) and a pension that he cannot receive for another year. His wife may have received some inheritance as her parents died a year or two back but I don't believe they were wealthy and she has at least one sibling to share it with and student loans to pay so ?maybe she could have gotten $100 k or something. My ex has not gotten any inheritance yet, although he might get something eventually when his parents die.
Is there really any benefit to having a revocable trust in a situation like this? It was always my impression from reading that there wouldn't really be.
I also wonder why he is paying the alimony out of the trust? I wonder if he mistakenly believes that the new tax laws about deductibility of alimony payments applies to him (it doesn't - old divorces stay the same, only new divorces are governed by the new tax law. He can still deduct his alimony payments to me and I still have to pay taxes on them).
None of this affects me directly, I'm just wondering about the possible benefits of a trust in his situation (including how it might affect my children's inheritance from him). I prefer not to ask him any questions directly. What do you think? (Btw he is 58 and in good health. His second wife is 19 years younger.).