Qualified Terminable Interest Property Trust

A qualified terminable interest property trust (also known as a “Q-Tip” trust) is a trust provision included in a will or revocable trust which is used by married couples to provide post-mortem flexibility in estate planning in order to avoid or minimize federal estate tax. All or some of the testator’s estate can be distributed to the Q-Tip trust for the use and benefit of the surviving spouse. After the date of death, the Internal Revenue Code allows the executor to decide how much of the Q-Tip trust will be protected from taxation through the marital deduction and how much will be protected from taxation through the unified credit. This will allow the executor certain post-mortem estate planning choices in the Federal Estate Tax Return (IRS Form 706) which the executor can use to decrease or eliminate the federal estate tax burden on the family.

The drafting and implementation of a Q-TIP trust should only be handled by a highly experienced estate planning attorney who has many years of experience in the drafting of sophisticated trusts and preparation of complicated Federal Estate Tax Returns. Attorney Rubino is a highly trained tax lawyer who has practiced in the area of estate tax law for 32 years. He can advise you on the possible use of Q-tip trusts in your estate plan as well as other estate planning instruments.

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