marital deduction


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marital deduction

n. when one spouse dies, the survivor may take a tax deduction of half of the value of the estate of the dying spouse. Thus, the minimum value of the estate before there is a possible federal estate tax rises from $600,000 to $1,200,000 at the death of the first spouse to die. In trusts which a married couple creates, they can agree that on the death of the first to go, the amount of the property which is given to the survivor is limited to the amount which will not be subject to federal estate tax, thus delaying some or all estate tax until the death of the surviving spouse. Such trust provisions should be written only by an attorney and with consultation with an accountant or financial adviser. (See: community property, estate tax, trust)

References in periodicals archive ?
citizens, one spouse can make unlimited tax-free transfers during life or at death to the other spouse as a result of the marital deduction that applies to transfers between spouses.
Claiming the marital deduction for gift and estate tax purposes
6/26/13), a case that dealt with the estate tax marital deduction set forth in Sec.
One of the first lines on a tax return is the Filing status, which can tell its whether our client qualifies for the estate taxes "unlimited marital deduction.
Perhaps the most important item for advisers is to be certain that any trust for the benefit of the surviving spouse that is to hold retirement plan benefits qualifies for the marital deduction.
Example Four: Determination of Net Income of an Estate in Marital Deduction Instances
The key remaining prohibitions are that income cannot be decreased in a trust qualifying for the marital deduction or a charitable deduction, or where the trustees are all beneficiaries of the trust.
2) In essence these provisions greatly restrict the availability of the marital deduction for such interspousal transfers; and prescribe that, where such transfers do qualify for the marital deduction, potentially severe tax consequences may ensue.
A married person's estate is allowed an unlimited marital deduction for the value of property transferred to the surviving spouse at death.
citizens to make bequests to their spouse and receive an unlimited federal estate tax marital deduction for all transfers to the surviving spouse (Sec.
Both presidential candidates and Congress have made it clear that the federal estate tax is here to stay, and marital deduction trusts will continue to be an important part of estate planning.
New features include IRC Chapter 14 -- Special Valuation Rules and its effect on value freezing as well as a new marital deduction chapter detailing the latest developments affecting QTIPS.