QTIP Elections in Estate Plans: When and How to Elect, Anenberg and McDougall, Interplay With Portability

QTIP trusts allow taxpayers to retain control over assets, provide lifetime support for a surviving spouse, and defer estate tax until the death of a surviving spouse. The decisions surrounding QTIP elections changed remarkably when portability was added in 2011. And, the election, once made, is irrevocable.

Two recent cases, Anenberg v. Commissioner and McDougall v. Commissioner, exemplify the importance of properly structuring and administering these trusts. The Anenberg and McDougall decisions reveal criteria for determining how and when subsequent transactions could subject beneficiaries to gift tax, thus negating the benefits of these tax-saving trusts. 

Trust and estate advisers need to understand when and how a client can benefit from a QTIP trust and when and how a QTIP election should be made on Form 706, United States Estate Tax Return.

Listen as our panel of astute transfer tax advisers discusses the benefits and caveats of QTIP trusts, recent developments, and how and when a QTIP election should be made.

I.                   QTIP trusts: introduction

II.                 Recent developments

A.    Anenberg v. Commissioner

B.    McDougall v. Commissioner

III.               Interplay with portability

IV.              Making the election on Form 706

V.                Examples and illustrations

The panel will cover these and other critical issues:

• Lessons learned from McDougall v. Commissioner
• The impact of a QTIP trust on DSUE (deceased spouse unused exclusion)
• Completing Schedule M, Form 706 for QTIP property
• Benefits and caveats of using QTIP trusts in estate plans

Learning Objectives

After completing this course, you will be able to:

• Identify subsequent transactions that could subject QTIP beneficiaries to gift tax
• Determine when a client's estate plan could benefit from a QTIP trust
• Ascertain how make a QTIP election on an estate return
• Decide how McDougall v. Commissioner impacts QTIP trust planning

• Field of Study: Taxes
• Level of Knowledge:
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite:

  Three years+ business or public firm experience preparing complex tax forms and schedules, supervising other preparers or accountants. Specific knowledge and understanding of estate, gift and trust taxation including various trusts types, the unified credit, and portability.

  
  

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IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).