This part covers estate tax planning techniques, including the marital deduction
and the use of various types of trusts.
Before the Supreme Court issued its decision in Windsor, (1) same-sex marriages were not recognized for federal tax purposes, and, therefore, same-sex spouses (1) were not treated as married for gift, estate, or GST tax purposes; (2) could not claim a marital deduction
for gifts or bequests to one another; and (3) were required to determine generation assignments for GST tax purposes based on age rather than on familial relationship with their spouse.
When does the gift of an annuity between spouses qualify for the gift tax marital deduction
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
." A married couple qualifies for this deduction; a silt* person does not.
As it turned out, the last-minute deal kept and made permanent the $5 million exemption, marital deduction
, portability and unified credit.
The plaintiff argued that the trust settlor had created the trusts primarily for estate tax purposes--so that he could pass the property to his wife and take advantage of the marital deduction
, while ultimately leaving the property to his daughter.
On the estate tax return, the 100 percent interest was valued at $2,834,033, and a marital deduction
was claimed for 51 percent of such amount, or $1,445,357.
Life insurance or annuity proceeds payable to a surviving spouse qualify for the marital deduction
if certain conditions are met (see Q 663).
Then transfer the balance of my estate ($500,000) to my wife [for which a marital deduction
will be claimed]."
allows tax-free inter-spousal transfers, whether inter
The federal estate tax also includes a marital deduction
for property passing to a surviving spouse.
IRC Section 2056(d) states that no deduction shall be allowed under Section 2056(a) (the unlimited marital deduction
) if the surviving spouse is not a U.S.