QTIP | Qualified Terminal Interest Property | IRC 2056
A qualified terminal interest property trust (QTIP) designed under IRC 2056 is a great method to pass on whealth to your surviving spouse and ultimately to your children. IRC 2056 allows an estate planner to implement and fund a Qualified Terminal Interest Property Trust (QTIP) to avoid some if not all of your taxes at the time of your passing. If your Qualified Terminal Interest Property Trust (QTIP) is set up correctly so as to comply with IRC 2056 you can pass most if not all of your assets to your spouse and children on a tax free basis at the time of your death. IRC 2056 has several caveats to proper implementation of the Qualified Terminal Interest Property (QTIP) and you should consult an IRS tax attorney such as myself in order to implement the Qualified Terminal Interest Property trust (QTIP) in a legal and appropriate manner.
Qualified Terminal Interest Property Trusts (QTIP)'s are mose frequently used when a spouse has children from another marriage and want to pass his/her assets on to his children after the death of his surviving spouse. IRC 2056 which allows for the creation of the Qualified Terminal Interest Property Trusts (QTIP)'s does not save the estate from being taxed at the time of death of the surviving spouse but there may be other tools besides the Qualified Terminal Interest Property Trust (QTIP) which can eliminate some of those future tax problems.
Once you do create a Qualifed Terminal Interest Property Trust (QTIP) under IRC 2056 you will need an attorney for the trustee of that trust. I offer attorney services for both the creation of the Qualified Terminal Interest Property Trust (QTIP) and services for the trustee once that trust has been created. A Qualified Terminal Interest Trust (QTIP) will have the terms and conditions spelled out specifically for the trustee before the grantor passes however the trustee will need an attorney to assist them and advise them of the legallity of there actions.
A trustee of a Qualified Terminal Interest Property Trust (QTIP) created under IRC 2056 will face personal liability for thier actions as trustee and you should have an attorney draft the Qualifed Terminal Interest Property Trust (QTIP) in such a way as to provide the trustee with the ability to hire an attorney to guide them throught the administration phase of the QTIP.
I will take into consideration your family situation including all possible tax burdens that you, your spouse, your children and your grand children will face when you see me about drafting your Qualifed Terminal Interest Property Trust (QTIP) under IRC 2056. If you have more than one millioin dollars in assets I would advise speaking with me to help begin or revise your estate plan.