Sieh, decedent husband created an
inter vivos trust prior to his marriage, retaining the power to revoke the trust.
The new law, says Lisle lawyer Neil Goltermann of Momkus McCluskey LLC, who assisted in drafting the legislation, means married couples will no longer have to forego the protections of holding property as tenants by the entirety to set up and fund
inter vivos trusts recommended for their estate plans.
Do total discretionary
inter vivos trusts that include Crummey powers qualify for automatic allocation of GST exemption?
2d 810 (Iowa 1998), recently joining cases supporting the RESTATEMENT (THIRD) OF TRUSTS position allowing creditors of a deceased settlor's estate to reach assets in his/her previously revocable
inter vivos trust.
While property passing to the spouse pursuant to an
inter vivos trust can qualify for the marital deduction, the shareholder often is unwilling to part with any of the incidences of stock ownership, particularly the voting power, before death.
In addition, assets held in a revocable
inter vivos trust are not subject to the surviving spouse's right of election because such assets are not subject to administration in Florida.
If the grantor is in a lower tax bracket, an
inter vivos trust might avoid the high rates if the trust agreement includes provisions that make it a grantor trust under Sees.
Example: Individual G creates an irrevocable
inter vivos trust as the grantor, using an unrelated third-party trustee.
Also, in Letter Ruling 200304037 (1/24/03), the surviving spouse was allowed to roll over the deceased spouse's IRA through a jointly created
inter vivos trust and survivor's subtrust; the Service noted that the actions constituted an election to treat the IRA as the surviving spouse's IRA (see Tax Trends, "Surviving Spouse Can Roll Over IRA Proceeds Received From Trust," TTA, April 2003, p.
However, under Section 1396p(d)(2)(A), an
inter vivos trust set up by the Medicaid recipient's spouse, legal guardian of the Medicaid recipient or his or her spouse, a court or by a person or court acting at the request of his or her spouse, may be treated as if the individual had used his or her own assets to create the trust.
A and C were married and created trust D, a revocable,
inter vivos trust.
the trustee of an
inter vivos trust included in the beneficiary's estate).
