Qualified Terminable Interest Property Trust

(redirected from Marital Deduction Trusts)

Qualified Terminable Interest Property Trust (Q-TIP)

A trust that allows a surviving spouse to receive income generated from the trust, while the actual distribution of the trust's assets is made to other beneficiaries such as the grantor's children.

Qualified Terminable Interest Property Trust

A trust into which the trustor deposits funds and other assets to provide for a surviving spouse while also maintaining control of what happens to those assets after the surviving spouse dies. In a Q-TIP, the trustor names his/her surviving spouse as beneficiary and provides that income and/or principal from the trust shall pass to that spouse upon the trustor's death. However, when the surviving spouse also dies, what remains in the trust is distributed to heirs as if it had been a part of the trustor's estate. A Q-TIP is a common trust when a person has children from a previous marriage; that Q-TIP provides for the surviving spouse but later is transferred to children from one's first marriage to ensure that the estate takes care of them as well.
References in periodicals archive ?
The statutory scheme revolves around the concept of "qualified terminable interest property" (commonly known as "QTIP"), which is defined as a subset of marital deduction trusts under Code section 2056(b)(7).
Both presidential candidates and Congress have made it clear that the federal estate tax is here to stay, and marital deduction trusts will continue to be an important part of estate planning.
A Practical Guide to Drafting Marital Deduction Trusts (with Sample Forms and Checklists) is available for $199 from The American Law Institute-American Bar Association's Web site at www.
For example, marital deduction trusts must normally distribute all income to the surviving spouse [IRC Sec.
Also this month, the ALI-ABA (Philadelphia, PA) published A Practical Guide to Drafting Marital Deduction Trusts, a hardbound book that explains more than 150 common tax and non-tax issues attorneys may need to consider when drafting and funding marital deduction trusts for federal estate tax purposes.
It highlights recent cases and rulings on valuation, family limited partnerships, deductibility of administration expenses and qualified marital deduction trusts.
Common marital deduction trusts are QTIP and power-of-appointment trusts.
Nonmarital and marital deduction trusts often are used together to achieve estate tax savings.
These trusts include marital deduction trusts, nonmarital deduction trusts, life insurance trusts and generation-skipping trusts.
Working papers contain revised client interview forms, wills and trusts, including several for specialized situations, such as marital deduction trusts, by-pass trusts and Crummey powers.
1) The QDOT must meet the basic requirements for any of the various marital deduction trusts under I.
This newly-revised edition provides integrated analysis of the income, estate and gift tax aspects of numerous types of trusts -- including grantor benefit and control trusts, life insurance trusts, charitable trusts, revocable trusts, community property trusts, QTIP and other marital deduction trusts and trusts for minors.