Seven requirements must be met for an interest to qualify for the federal estate tax marital deduction:
1.The decedent must be legally married at the time of his or her death;
2.The person to whom the decedent is legally married at the time of his or her death must survive the decedent;
3.The surviving spouse must be a U.S. citizen (or the property must be held in a Qualified Domestic Trust.
4.The interest passing to the surviving spouse must be includable in the decedentýs gross estate in the United States;
5.The interest must pass to the surviving spouse;
6.The interest received by the surviving spouse must be a deductible interest; and
7.The value of the interest passing to the surviving spouse must be at its net value.
An interest is nondeductible to the extent that it is not includable in the decedentýs gross estate. A marital deduction will not be allowed for property that is otherwise deductible as an expense, claim or loss. No double deduction is permitted. Thus, an interest cannot qualify for the marital deduction if it otherwise is deducted under either IRC Section 2053 or Section 2054. IRC Section 2056(b)(9). For example, no marital deduction is allowed for property that passes to the surviving spouse that is used by the estate to pay the decedentýs funeral expenses.
Section 2056(c) of the IRC defines passing to include interests acquired by the surviving spouse by will, intestate succession, dower, curtesy, statutory share, right of survivorship, the exercise or default of exercise of a power of appointment, or pursuant to a life insurance beneficiary designation. The passing requirement also can be satisfied by designating the surviving spouse as the beneficiary of employee death benefits or any other annuity includable in the decedentýs gross estate under IRC Section 2039. (Treas. Reg. §20.2056(c)-1, 2, 3).
A Fairfax Virginia Marital Deduction Trust with Lifetime Income and Power of Appointment in Beneficiary Spouse and Residuary Trust is a specialized estate planning tool that allows individuals in Fairfax, Virginia, to protect their wealth, provide for their spouse, and efficiently transfer assets upon their death. This type of trust enables one spouse (the granter) to establish a trust that provides a lifetime income to the surviving spouse while preserving the remaining trust assets for the benefit of other beneficiaries, typically children or grandchildren. The trust also includes a power of appointment, which allows the surviving spouse to determine who will receive the trust assets upon their death. This estate planning strategy offers several advantages, including reducing estate taxes by taking advantage of the marital deduction. The marital deduction allows an individual to leave an unlimited amount of assets to their spouse without incurring estate taxes at the first spouse's death. However, if the surviving spouse passes away with a significant estate, those assets could be subject to estate taxes. By utilizing a Marital Deduction Trust, the granter can safeguard a portion of their estate from estate taxes. The trust structure typically consists of two main components: the Marital Deduction Trust and the Residuary Trust. The Marital Deduction Trust provides the surviving spouse with income generated by the trust assets during their lifetime. This income is often paid at regular intervals and can help maintain the surviving spouse's financial well-being. Upon the surviving spouse's death, the assets remaining in the Marital Deduction Trust pass to the Residuary Trust. The Residuary Trust protects the remaining trust assets for the ultimate beneficiaries, such as children or grandchildren. The surviving spouse typically has a power of appointment over the assets in the Residuary Trust, meaning they can decide who will receive these assets upon their death. This flexibility allows the surviving spouse to consider changing circumstances, family dynamics, and the needs of their loved ones when designating the beneficiaries. By naming appropriate trustees, this type of trust ensures that the granter's wishes are carried out according to their instructions. Trustees should be chosen carefully and can include family members, close friends, or professional trustees with experience in managing trusts. In conclusion, a Fairfax Virginia Marital Deduction Trust with Lifetime Income and Power of Appointment in Beneficiary Spouse and Residuary Trust is a comprehensive estate planning tool that provides financial security to a surviving spouse while preserving the granter's wealth for future generations. It offers tax benefits and flexibility in asset distribution. Different variations or modifications to this trust structure may be available, such as the addition of charitable components or special provisions unique to individual circumstances.A Fairfax Virginia Marital Deduction Trust with Lifetime Income and Power of Appointment in Beneficiary Spouse and Residuary Trust is a specialized estate planning tool that allows individuals in Fairfax, Virginia, to protect their wealth, provide for their spouse, and efficiently transfer assets upon their death. This type of trust enables one spouse (the granter) to establish a trust that provides a lifetime income to the surviving spouse while preserving the remaining trust assets for the benefit of other beneficiaries, typically children or grandchildren. The trust also includes a power of appointment, which allows the surviving spouse to determine who will receive the trust assets upon their death. This estate planning strategy offers several advantages, including reducing estate taxes by taking advantage of the marital deduction. The marital deduction allows an individual to leave an unlimited amount of assets to their spouse without incurring estate taxes at the first spouse's death. However, if the surviving spouse passes away with a significant estate, those assets could be subject to estate taxes. By utilizing a Marital Deduction Trust, the granter can safeguard a portion of their estate from estate taxes. The trust structure typically consists of two main components: the Marital Deduction Trust and the Residuary Trust. The Marital Deduction Trust provides the surviving spouse with income generated by the trust assets during their lifetime. This income is often paid at regular intervals and can help maintain the surviving spouse's financial well-being. Upon the surviving spouse's death, the assets remaining in the Marital Deduction Trust pass to the Residuary Trust. The Residuary Trust protects the remaining trust assets for the ultimate beneficiaries, such as children or grandchildren. The surviving spouse typically has a power of appointment over the assets in the Residuary Trust, meaning they can decide who will receive these assets upon their death. This flexibility allows the surviving spouse to consider changing circumstances, family dynamics, and the needs of their loved ones when designating the beneficiaries. By naming appropriate trustees, this type of trust ensures that the granter's wishes are carried out according to their instructions. Trustees should be chosen carefully and can include family members, close friends, or professional trustees with experience in managing trusts. In conclusion, a Fairfax Virginia Marital Deduction Trust with Lifetime Income and Power of Appointment in Beneficiary Spouse and Residuary Trust is a comprehensive estate planning tool that provides financial security to a surviving spouse while preserving the granter's wealth for future generations. It offers tax benefits and flexibility in asset distribution. Different variations or modifications to this trust structure may be available, such as the addition of charitable components or special provisions unique to individual circumstances.
Para su conveniencia, debajo del texto en español le brindamos la versión completa de este formulario en inglés. For your convenience, the complete English version of this form is attached below the Spanish version.
