Trust C uses the Marital Deduction to defer estate taxes on the balance of the GSTT exemption going to the grandchildren. This trust is also referred to as a Reverse QTIP trust. The values in this trust will be included in the taxable estate of the surviving spouse. The income from this trust is available for the surviving spouse, but all remaining assets at the surviving spouse’s death will pass to the skipped generation – the grandchildren.

Trust A (ABC Trusts) | Trust B (ABC Trusts) | ABC Trusts for Generation-Skipping (Illustration) | ABC Trusts for Generation-Skipping (Definition)

 

 

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