How to Protect Stepchildren's Inheritance in California

Protect your children and new spouse in second marriage

By Rozsa Gyene, Estate Planning Attorney | State Bar #208356

What is a Blended Family Living Trust California?

A blended family living trust is specially designed for second (or third+) marriages where:

• You have children from previous relationship
• Your new spouse has children from previous relationship
• You want to protect YOUR children's inheritance
• You also want to care for your new spouse

Common blended family scenarios in California:

• Second marriage with stepchildren
• Remarriage after divorce
• Remarriage after death of first spouse
• Unmarried couples with children from previous relationships
• "His, hers, and ours" families (children from both previous marriages + children together)

Why Standard Trusts Don't Work for Blended Families

Problem #1: Surviving Spouse Could Disinherit Your Kids

Standard joint trust scenario:

1. You and new spouse create joint living trust
2. Trust says: "When first spouse dies, survivor gets everything. When survivor dies, split between all children."
3. You die first. Your spouse inherits everything.
4. Your spouse remarries. Changes the trust to leave everything to new spouse.
5. Your biological children get NOTHING.

This happens more often than you think.

Problem #2: California Community Property Creates Confusion

In California, assets acquired during marriage are community property (50% yours, 50% spouse's). But what about:

• Your home from first marriage (separate property)
• Inheritance from your parents (separate property)
• Assets you brought into second marriage (separate property)
• House you bought together in second marriage (community property)

Standard trusts often don't clearly separate separate vs community property. Result: Litigation after you die.

Problem #3: Stepchildren vs Biological Children Conflicts

Without proper planning:

• Your spouse's children may inherit your assets (not what you wanted)
• Your children may get nothing
• Families fight in court for years

How Blended Family Living Trust Works (AB Trust Structure)

The solution: AB Trust (also called "A/B Trust" or "Marital/Family Trust")

How It Works:

During Your Lifetime:

• You and spouse create living trust
• Clearly identify separate property vs community property
• Specify what happens when each spouse dies

When First Spouse Dies:

Trust automatically splits into two trusts:

Trust A (Survivor's Trust)	Trust B (Deceased's Trust)
Contains surviving spouse's share	Contains deceased spouse's share
Surviving spouse has full control	Locked - cannot be changed
Can be modified by survivor	Protects deceased's wishes
Survivor decides who inherits	Goes to deceased's biological children
When survivor dies → goes per survivor's wishes	Surviving spouse gets INCOME only, not principal

What Surviving Spouse Gets from Trust B:

• Income from investments (dividends, interest, rent)
• Right to live in home (if home is in Trust B)
• HEMS distributions (Health, Education, Maintenance, Support) if needed
• But CANNOT: Change beneficiaries, give assets away, disinherit stepchildren

When Second Spouse Dies:

• Trust A: Goes to whoever surviving spouse named (usually their biological children)
• Trust B: Goes to first spouse's biological children (as originally specified - can't be changed)

Result: Both sets of children are protected.

Example: His-Hers-Ours Trust

Second Marriage Living Trust California — Key Provisions

1. Separate Property Identification

Your trust must clearly list:

• What you owned before marriage (separate property)
• What you inherited or received as gift (separate property)
• What you earned/bought during marriage (community property)

2. Community Property Division

For assets acquired during second marriage:

• 50% is yours (goes in your Trust B when you die)
• 50% is spouse's (goes in their Trust B when they die)

3. Survivor Rights and Restrictions

What surviving spouse CAN do:

• Receive income from Trust B
• Live in home
• Request principal for health, education, maintenance, support (HEMS)

What surviving spouse CANNOT do:

• Change Trust B beneficiaries
• Sell Trust B assets (except with trustee approval for HEMS)
• Give Trust B assets to their children
• Disinherit your biological children

4. Children's Protection

Your biological children are guaranteed:

• Your separate property
• Your 50% of community property
• Cannot be disinherited by surviving spouse
• May receive assets earlier if you specify (e.g., at age 25, 30, 35)

Remarriage Estate Planning California — Special Considerations

Prenuptial Agreement + Living Trust

Best practice for second marriages: Combine prenup with living trust.

Prenuptial agreement specifies:

• What remains separate property
• What becomes community property
• Waiver of spousal inheritance rights (if desired)

Living trust implements:

• How assets actually transfer
• Protections for both spouse and children

Updating Trust When You Remarry

CRITICAL: Update your trust within 6 months of remarriage.

What to update:

• Remove ex-spouse (if trust from first marriage)
• Add new spouse (if appropriate)
• Specify separate vs community property
• Add AB trust provisions
• Protect biological children
• Update beneficiaries
• Update trustees

Stepchildren Inheritance California — Common Questions

Do I have to leave anything to stepchildren?

No. California law does NOT require you to leave anything to stepchildren. You can:

• Leave everything to your biological children only
• Include stepchildren if you want
• Treat all children equally (yours, spouse's, ours)
• Give different amounts to different children

Will my stepchildren inherit from my spouse?

Yes, if your spouse's trust says so. When your spouse dies:

• Their Trust B (their 50%) → Goes to whoever they named (usually their biological children)
• Your stepchildren will likely inherit from their biological parent
• Your biological children will inherit from your Trust B

Can I adopt my stepchildren to ensure they inherit?

Yes, but consider carefully:

• Adult stepchild adoption is legal in California
• Once adopted, they're legally your children (for inheritance)
• This is permanent (can't "unadopt")
• May affect their inheritance from biological parent

Cost: Blended Family Living Trust California

Option	Cost	Includes AB Trust?
Living Trust California (online + attorney review)	$150	✓ YES
Traditional attorney (blended family specialist)	$2,000-$4,000	✓ YES
LegalZoom (generic, no AB trust)	$279-$478	✗ NO (not designed for blended families)

Key Takeaways: Blended Family Living Trust California

• Standard trusts don't protect blended families — surviving spouse can disinherit stepchildren
• AB trust structure is the solution — trust splits when first spouse dies, locks in beneficiaries
• Surviving spouse gets income, children get principal — everybody protected
• Must identify separate vs community property — prevents litigation
• Update trust within 6 months of remarriage — old trust likely leaves everything to ex or deceased first spouse
• Stepchildren have no automatic inheritance rights — you choose who inherits
• Combine with prenuptial agreement for maximum protection
• Cost: $150 for attorney-reviewed trust vs $2,000-$4,000 traditional attorney

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About: Rozsa Gyene, California Estate Planning Attorney, State Bar #208356, 25+ years experience helping blended families protect children and spouses in second marriages.

© 2025 Living Trust California. Rozsa Gyene, Attorney at Law, State Bar #208356.