Section 4.7 Will Form—Including Qualified Terminable Interest Property Trust

• Library: Estate Planning 2013 Forms

Will Containing Pecuniary Marital Deduction Formula; Qualifying Trust A for the Benefit of the Spouse QTIP (Qualified Terminable Interest Property) Trust; Nonqualifying Trust B for the Benefit of the Spouse and Descendants (Credit Shelter Trust); With Generation-Skipping Provisions

Note: Only the dispositive provisions of the will are set forth below. See the form in §4.5 above for the balance of the will.

Article II

I give all the rest of my property to the Trustees hereinafter named, in trust, upon the following terms and conditions:

A. Division of Trust Property

The Trustees shall divide the property (together with any other property to which the Trustees may be entitled by reason of my death and less any taxes, debts, expenses, or other obligations payable by the Trustees as a result of my death) into two shares determined as follows:

1. Trust A

The first share (to be created only if my spouse, Jane Doe, survives me), called “Trust A,” shall be in an amount equal to all property to be divided into shares, reduced by the lesser of:

· the maximum amount that will avoid any federal estate tax being due in my estate; or

· the maximum amount that will avoid any state death tax being due in my estate.

In determining this amount, any property of Trust A that my Personal Representative shall not elect to have qualify for the federal marital deduction, if applicable, along with any property of Trust A disclaimed by my spouse, shall be disregarded. Any property of Trust A so disclaimed by my spouse shall become a part of Trust B. If applicable, final federal estate tax values shall be used in determining the amount of Trust A. Assets shall be allocated to Trust A using the basis of such assets as determined for federal income tax purposes, provided that Trust A shall be satisfied with property fairly representative of appreciation or depreciation in value of all property available for allocation to Trust A, this appreciation or depreciation to be determined from the federal income tax value of the assets. There shall be allocated to each trust its proportionate share of all income from the date of my death, including income collected by the Personal Representative of my estate and transferred to the Trustee. Trust A shall be reduced by any death taxes that are payable on account of the assets composing Trust A and shall not be reduced by death taxes that are payable on account of any other property.

2. Trust B

The second share, called “Trust B,” shall consist of the property that is not included in Trust A and shall consist of all property if my spouse does not survive me.

B. Distribution of Trust A

The Trustees shall distribute Trust A as follows:

1. During Life of Spouse

While my spouse is living, the Trustees:

a. Income Distributions to Spouse

Shall pay to her, at least quarter annually, all the net income of Trust A.

b. Rights of Spouse to Withdraw Principal

Shall pay to my spouse from the principal of Trust A property or sums of money that my spouse from time to time requests in writing, not to exceed during any calendar year five percent of the principal value of the trust when the payment is made (or if more than one payment is made during the year, at the time the last payment is made) or $5,000, whichever is greater.

2. Distribution Upon Death of Spouse

Upon the death of my spouse, the principal and any undistributed net income of Trust A shall be added to and disposed of as a part of Trust B, under all the terms that pertain to it, provided, however, that the Trustees, if legally obligated so to do, shall pay out of Trust A to the Personal Representative of the estate of my spouse (or shall pay directly) the death taxes due as a result of the inclusion of the value of the principal of Trust A (if any) in my spouse’s gross estate as well as any penalties or interest attributable to the additional taxes. The Trustees may rely on the amount certified to the Trustees by the Personal Representatives of my spouse’s estate as being the correct amount of the taxes, and the Trustees shall not be obligated to verify the computation as to the taxes so attributable to the...