QTIP FOR SECOND MARRIAGE

Submitted by Mary Louise on Thu, 2018-08-30 15:46

Hi I had posted this before, but I cannot find it in the forum. Does anyone know for a second marriage if an IRA is part of a QTIP and the one spouse is not 70 1/2 and passes, what would be considered income. In addition, if the spouse is 70 1/2 and passes, then what would be considered income? What if cash is part of the QTIIP, how would income be calculated? Any information would be appreciated. Thank you.



Submitted by Bruce Steiner on Mon, 2018-09-03 19:42

  • You would look to the income earned within the IRA, and the income earned in the trust.  However, in some states, the spouse can ask that the trust be treated as a unitrust, in which case income will be a percentage (between 3% and 5% a year) of the value of the trust (including the IRA).
  • Note that leaving an IRA to a marital trust reduces the stretch.
  • With an $11,180,000 (indexed) estate tax exclusion amount, very few people will need to create marital trusts, and those who do may be able to provide for the spouse with other assets.
  • Bruce Steiner

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