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Fulfill Three Goals With One Trust

As you plan your estate, what goals come to mind? Of course caring for your surviving spouse so he or she is financially secure is always at the top of your list. You may also be interested in setting up a trust in order to maintain control over the principal assets so eventually they will pass to designated beneficiaries. And finally, you want to avoid the imposition of any federal estate tax on those assets.

There is one estate planning vehicle that can fulfill all of these wishes—the QTIP trust. QTIP is simply an abbreviation for "qualified terminable interest property," the IRS description of assets that qualify for the estate tax marital deduction without giving away ultimate control of those assets by the decedent.

You can create a QTIP trust either through your will or during your lifetime through a separate trust agreement. The trust will pay your surviving spouse the income for life and even some principal if needed for support. But after your spouse's death, the distribution of the remaining assets will be controlled by your trust provisions rather than by your spouse's will.

Zero Estate Tax Strategy
Because of the unlimited marital deduction, all of the assets you leave in a QTIP trust will avoid any federal estate tax until your surviving spouse dies. In addition, any QTIP trust assets you have left to a qualified charitable organization, like Sisters Hospital Foundation, will qualify for the estate tax charitable deduction.

As with any estate planning, meet with your professional advisors to create a plan that fits your needs. Our office will help in any way we can, at no obligation.

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Please call Julie Snyder at 716-862-1992, or e-mail us at jsnyder@chsbuffalo.org, for more information.

The information in this Web site is not intended as legal advice. For legal advice, please consult an attorney. Figures cited in examples are for hypothetical purposes only and are subject to change. References to estate and income tax include federal taxes only. Individual state taxes and/or state law may impact your results.