If the estate's value exceeds a certain value, upon the death of the surviving spouse a Trust C may have been created. This third trust, an irrevocable one, would have contained the assets of the first spouse to die that exceeded the estate tax exemption.
In many cases the different trusts have different beneficiaries. If the beneficiaries of Trust A, Trust B, and a possible Trust C are different, it is important for the trustee or trustees to keep all the assets and their associated incomes and expenses separate. This also requires the trustee to correctly list all of each trust's assets under the correct Tax Identification Number, which will be different for each trust.
The provisions of each trust may vary considerably, another reason to carefully segregate the assets of each and account for them separately. If the trusts have different trustees, a condition that can occur, it is imperative that the various trustees also work in concert to make sure no action they take adversely affects the other trusts.
The trusts also may not expire at the same time. The trustee of Trust C may wish to keep that particular trust continuing, for tax purposes. When the surviving spouse dies and the federal estate tax return for that person is filed, additional federal estate taxes may be due. Since Trust C may be liable for, and have to pay, any proportionate share of the tax due, Trust C may have to be kept intact longer than Trust B.
Aside from that, re-registration of assets, accounting, distribution of the assets contained in Trust C, and similar responsibilities and activities are the same as for Trust A and Trust B.