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.
