marital deduction


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Marital deduction

A tax deduction that allow spouses to transfer unlimited amounts of property to one another.

Marital Deduction

A deduction one may take when one transfers assets to one's spouse. All gifts and other transfers to a spouse are tax free; one may take advantage of this to reduce one's taxable income (within certain limits). Most marital deductions occur when one is planning one's estate.

marital deduction

The deduction for tax purposes of property transferred between spouses. For estate and gift purposes, all transfers between spouses are free of federal taxation.

marital deduction

For estate tax and gift tax purposes, the 100 percent deduction granted for assets passing to spouses.

References in periodicals archive ?
For an estate to qualify for the marital deduction, the interest passing to the surviving spouse must be a nonterminable interest.
2523 generally allows an unlimited marital deduction for gifts to spouses as long as the spouse is a U.S.
A direct gift to a spouse of an annuity contract in which no one else has an interest qualifies for the gift tax marital deduction. The interest of a donee spouse in a joint and survivor annuity in which only the donor and donee spouses have a right to receive payments during such spouses' joint lifetimes is treated as a "qualifying income interest for life" for which the marital deduction is available unless the donor spouse irrevocably elects otherwise within the time allowed for filing a gift tax return.
If the tax return is for a married couple and they are married tiling separate, determine if there are also separate property considerations that can affect the marital deduction. If, for example, the couple has a prenuptial agreement, it's possible that the less wealthy spouse might waste sonic of their lifetime exemption.
In its petition filed with the Tax Court, the estate argued that the marital deduction for the 51 percent bequest to the surviving spouse should be increased by a control premium of 38.1 percent.
Where the survivor is the deceased annuitant's spouse, the value of the survivor's annuity will qualify for the marital deduction if the contract satisfies the conditions discussed at Q 663.
Probably the most severe consequence of the Illinois estate tax decoupling from the federal estate tax is the unavailability of the marital deduction for transfers to a qualified terminable interest property trust ("QTIP") for Illinois estate tax purposes only.
creation of the marital deduction. From 1948 to 1981 (with a slight
Certain trusts and nuptial agreements can be used to protect a individual's estate without disinheriting a spouse in ways that can preserve the marital deduction.
To prevent a surviving spouse from deferring tax on assets of the deceased spouse and then avoiding the estate tax, Congress instituted IRC Section 2056(d), imposing the estate tax on any transfer to the surviving non-citizen spouse that would otherwise pass to such spouse's estate tax-free via the marital deduction.
Property that passes by operation of law cannot qualify for the marital deduction.
If all three tests are met, the interest will not qualify for the marital deduction.