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.
A New Hampshire Inter Vivos TIP Trust with Principal to Donor's Children on Spouse's Death is a specific type of trust that allows a donor to transfer assets to their spouse while still maintaining control over how those assets are distributed after the spouse's death. This trust is commonly utilized by individuals who want to provide for their surviving spouse during their lifetime, but also want to ensure that their children or other designated beneficiaries receive the remaining trust assets upon the spouse's passing. Keywords: New Hampshire, Inter Vivos TIP Trust, Principal, Donor's Children, Spouse's Death, trust assets, surviving spouse, designated beneficiaries. There are different variations or types of New Hampshire Inter Vivos TIP Trusts with Principal to Donor's Children on Spouse's Death, including: 1. Revocable Inter Vivos TIP Trust: This type of trust allows the donor to make changes or revoke the trust during their lifetime. It provides flexibility and control over the assets in the trust. 2. Irrevocable Inter Vivos TIP Trust: Unlike the revocable trust, this type of trust cannot be altered or revoked once it has been established. It offers greater asset protection and may provide tax advantages. 3. Testamentary Inter Vivos TIP Trust: This trust becomes effective only upon the death of the donor. Assets are transferred to the trust as outlined in the donor's will, and the trust's provisions then govern the distribution to the surviving spouse and donor's children. 4. Discretionary Inter Vivos TIP Trust: This type of trust grants the trustee discretionary power in distributing trust assets to the surviving spouse and donor's children according to the trust's terms or guidelines. The trustee has the responsibility to make decisions based on the beneficiaries' needs and best interests. 5. Non-Deductible Inter Vivos TIP Trust: In certain cases, the donor might choose not to claim a federal estate tax deduction for the transfer of assets to the trust. This type of trust is often preferred when the donor's estate is not expected to exceed the federal estate tax threshold, or if the donor wishes to maximize the inheritance received by the children. Overall, a New Hampshire Inter Vivos TIP Trust with Principal to Donor's Children on Spouse's Death is an effective estate planning tool for individuals in New Hampshire who want to ensure the financial security of their surviving spouse while still providing for their children or other chosen beneficiaries after their spouse's passing. It offers control, flexibility, and potentially reduces estate taxes while ensuring the donor's wishes are fulfilled.
