In today’s world of “blended families,” estate planning has gotten more complex. If you have had more than one marriage with children from the prior marriage(s), you are likely concerned with ensuring that your biological children will inherit from you. It is a valid concern because you might be surprised at how often a surviving spouse inherits everything and shares nothing with the decedent’s children.
There are specific ways your estate planner can prevent this scenario from happening to your family. One commonly used safeguard is referred to as a “QTIP trust,” which stands for “qualified terminable interest property” trust. One of the primary advantages of a QTIP trust is it provides you the ability to provide for your surviving spouse and, after his or her death, your beneficiaries as designated by you in your trust.
A QTIP trust is typically funded through the creator’s Will. As a result, the trust will only be funded upon your death. When you die, your surviving spouse will receive the income from the trust for the remainder of his or her life. When the surviving spouse dies, the remaining trust assets will pass to your children or other loved ones specifically designated by you.
The QTIP trust may also assist with deferring estate taxation. Because your property is initially transferred to your surviving spouse, the estate tax marital deduction is applied and postpones the payment of any estate taxes until your children or other beneficiaries receive the remainder of the trust.
If you are interested in learning more about a QTIP trust or you have any other estate planning questions, please don’t hesitate to contact us. The Astill Law Office has provided high quality legal services for over 30 years. We specialize in wills, trusts, estate planning, and asset protection. If you have any questions about creating a Trust, Will, or estate planning in general, contact The Astill Law Office at 801-438-8698.