Jensen and Lori Huang's Nvidia fortune is jointly controlled. How that makes things complicated now that he's resigned

A version of this article appeared in CNBC's Inside Wealth newsletter, a weekly guide to the high-net-worth investor and consumer. Sign up to receive future editions straight to your inbox.

Jensen Huang's $140 billion stake in Nvidia is largely held by trusts that are co-owned with his wife, Lori, creating added uncertainty for the shares and his financial future following his resignation from the company, according to attorneys and SEC filings.

Huang and his wife jointly own about 800 million Nvidia shares worth roughly $135 billion through a complex web of trusts and LLCs created for tax and estate planning purposes, according to SEC filings. Jensen Huang directly owns about 70 million shares valued at about $12 billion.

While owning company stock through a trust is common among tech founders and CEOs, it's less typical for a founder to have equal ownership with a spouse, tax experts say. The arrangement further complicates Huang's sudden exit from the company, but could prove to be a stabilizing force for the shares, since the trusts make it more difficult for either Huang or his wife to quickly sell.

"Each of Mr. Huang and his wife may be deemed to have shared beneficial ownership of, and to exercise shared voting and investment power over," according to an SEC filing.

According to the filings, Jensen and Lori Huang own about 530 million shares as co-trustees of the Jen-Hsun and Lori Huang Living Trust, created in 1995. They're also co-trustees of the Huang 2012 Irrevocable Trust, which owns 31.4 million shares, and the Huang Irrevocable Remainder Trust, which owns 109 million shares. About 135 million shares are held by LLCs that have the Living Trust as the sole member, according to the filings.

Lori Huang is the president of the Jen-Hsun and Lori Huang Foundation, which owns 69 million shares and reported $9 billion in net assets in 2024, according to IRS filings.

Each of the trust structures serves different tax or estate purposes, according to trust and estate attorneys. The living trust is likely a revocable marital trust, since it was created 10 years after the Huangs married and two years after Nvidia was founded in 1993.  Attorneys say living trusts help couples avoid the potentially expensive and public probate process  when one spouse dies. Many couples, for example, create living trusts for homes they purchase or other assets.

The main tax benefit of living trusts is that when one spouse dies, the surviving spouse gets a step-up in basis for the entire trust's assets, rather than just their half, according to attorneys.

While the rules of each living trust vary, attorneys say shares in the living trust can typically be sold or divided fairly easily in the case of a divorce.

"It's like a joint checking account," said Kathleen Martone, partner at Varnum LLP.

While the revocable trust would typically allow each of them to sell their shares, lawyers said it is common for executives or their trusts to have agreements with the company limiting the sale or transfer of shares to prevent large-scale liquidation.

"In the event they divide shares in their revocable trust, there's probably transfer restrictions. He may have to hold them for her benefit, and she would get the monetary benefit of the shares but not voting or management rights," said Leslie Evans, partner at Withers. "He could retain the stock while Lori receives other assets or an equalization payment."

The more complicated structures used by the Huangs, and the ones with the largest tax benefits, are the irrevocable trusts. The SEC filings state that "Mr Huang and his wife are co-trustees" of both trusts. With an irrevocable trust, the creator transfers ownership of an asset into the trust and the terms can't be changed without the consent of the beneficiaries or a court.

Attorneys say the 2012 irrevocable trust is likely an "intentionally defective grantor trust," a type of irrevocable trust where the creator gifts assets but is still treated by the IRS as the owner of the property for income tax purposes. 

The structure allows the creator to lend money to the trust to buy the shares, as well as pay income taxes for the trust when it earns money. The result — an unlimited gift to the trust that escapes the estate tax.

What's more, the trust can avoid capital gains taxes on any appreciation of the shares in the trust.

"The trust principal is staying high, my own taxable personal assets are being used to pay the tax, and I'm able to funnel more and more money into the trust," said Azriel Baer, trust and estates partner at Farrell Fritz, P.C. in New York.

Their other irrevocable trust, the "Huang Irrevocable Remainder Trust," was likely created for the benefit of their children.

By definition, the trustees and terms of an irrevocable trust are difficult to change. Since Jensen Huang and Lori Huang are both co-trustees, neither can likely remove or sell the Nvidia shares held by the trust, experts say.

"An irrevocable trust is its own entity that has its own operational provisions, and so it has some estate and asset protection planning," Martone said. "Theoretically an irrevocable trust would be protected from a divorcing spouse as a creditor."

Of course, the protections all depend on the terms of the trust, attorneys say. Whether an irrevocable trust can be changed or "decanted" in legal parlance depends in part on state law. California, where the Huangs live, is strict when it comes to changing irrevocable trusts.

For Nvidia shareholders, the irrevocable trusts could provide stability for the shares, since it would be difficult for either Jensen or Lori Huang to remove the shares from the trust and sell them.

Attorneys say it's unlikely the Huangs would change a trust created for the benefit of their children.

"If (the trusts) are for benefit for kids, there's no reason to pull them back into their estate," said Rochelle Schultz, shareholder at Weinstock Manion.