Gifts to trusts can take advantage of high tax exemptions and remove future appreciation of assets from taxable estates.
One example available to spouses is making a gift to a trust that allows for a qualified terminable interest property (QTIP) election. Spouses are named as the primary beneficiary of the trust, and during their lifetime they must be the only beneficiary of the trust entitled to income and/or principal of the trust.
Friedman's Brandon Baker—CPA and Partner, Trust, Estate and Gift Tax Practice Leader—spoke to this in a recent article for Financial Advisor:
“The spouse’s lifetime interest would provide that they receive all income at least annually,” Baker said.
To read the full article, head here.