A trust is a fiduciary relationship in which one party holds legal title to another's property for the benefit of a party who holds equitable title to the property. An inter vivos trust is a trust that becomes effective during the lifetime of the person creating the trust (the settler or trustor).
A qualified terminable interest property trust, often referred to as a "QTIP" trust, allows a bequest to a spouse in trust that, after a proper election by the beneficiary spouse, qualifies for the unlimited marital deduction:
" if the beneficiary spouse is entitled to all of the income from the trust property,
" if the income is payable annually or at more frequent intervals, and
" if no person, including the beneficiary spouse, has the power to appoint any part of the qualifying property to any person other than the beneficiary spouse during the beneficiary spouse's lifetime.
In order that the property transferred to a surviving spouse by means of an inter vivos marital deduction trust qualify for the marital deduction, the property must be includible in the trustor's gross estate for federal estate tax purpose.
Louisiana Inter Vivos TIP Trust with Principal to Donor's Children on Spouse's Death is a type of trust that offers a solution for individuals in Louisiana who wish to provide for their spouse while also ensuring the ultimate distribution of their assets to their children upon the spouse's death. This trust strategy allows for the preservation and management of assets for the benefit of the surviving spouse while securing the ultimate transfer of the remaining assets to the donor's children. Within the realm of Louisiana Inter Vivos TIP Trust with Principal to Donor's Children on Spouse's Death, there are different types that can be established depending on specific needs and circumstances. Some key variations and categories include: 1. Lifetime Louisiana Inter Vivos TIP Trust: In this type, the trust is created during the donor's lifetime and the principal assets are utilized to provide for the surviving spouse's support and maintenance during their lifetime. Upon the death of the surviving spouse, the remaining trust assets pass to the donor's children. 2. Testamentary Louisiana Inter Vivos TIP Trust: Different from a lifetime trust, this type of trust is established through the donor's will and only comes into effect upon their death. The trust is then funded with assets designated by the donor to ensure the survival and well-being of the surviving spouse. Once the spouse passes away, the trust assets are distributed to the donor's children. 3. Married Couples TIP Trust: This variation is specifically designed for married couples who want to provide for their surviving spouse during their lifetime while preserving the remaining assets for their children. It allows for the surviving spouse to receive income distributions from the trust during their lifetime, with the principal assets passing to the donor's children after their death. 4. Blended Family Louisiana Inter Vivos TIP Trust: This type of trust is suitable for individuals in blended families. It ensures that the surviving spouse is taken care of while also protecting the interests of the donor's children from a previous relationship. The trust can be structured to provide income and support for the surviving spouse throughout their lifetime, with the remaining assets eventually going to the donor's children. Overall, a Louisiana Inter Vivos TIP Trust with Principal to Donor's Children on Spouse's Death is a sophisticated estate planning tool that can help individuals navigate the complexities of asset distribution between a spouse and children in Louisiana. By tailoring the trust to one's specific needs and situation, individuals can create a comprehensive plan that provides financial security for their loved ones while also ensuring the preservation of their assets for future generations.
