When creating an estate plan, one common goal is to provide for a surviving spouse while also ensuring that certain assets eventually pass to other chosen beneficiaries—like children from a previous relationship. A QTIP trust can help accomplish that balance.
What’s a QTIP Trust?
A QTIP trust—short for Qualified Terminable Interest Property trust—is a type of trust that allows one spouse to set aside assets for the surviving spouse’s use during their lifetime, while still deciding who gets what’s left after that spouse passes away. It’s often used when there’s a desire to support a spouse and still retain control over where assets go long term.
How It Works
- After one spouse dies, the surviving spouse receives income from the trust and may also have limited access to the principal.
- The trust stays in place for the rest of the surviving spouse’s life.
- When the second spouse passes, remaining assets go to the final beneficiaries chosen by the first spouse.
The key feature of a QTIP trust is that it separates lifetime use from long-term control—the surviving spouse benefits from the trust, but cannot change who ultimately receives the assets.
Who Might Consider One?
A QTIP trust may be useful in cases such as:
- Blended families, where someone wants to support a current spouse but also ensure children from a previous marriage receive an inheritance.
- Second marriages, where each spouse brings their own assets or family into the relationship.
- Larger estates, where there’s a desire to manage the timing and structure of how assets are passed on.
- This type of trust can also help provide structure and predictability in how assets are used and distributed after death.
A QTIP trust isn’t right for everyone, but for those looking to protect a spouse while keeping long-term control over their legacy, it can be a helpful tool within a broader estate plan.
Interested in whether a QTIP trust could fit your estate planning goals? Contact our team at Eastham Law Offices to schedule a consultation and explore your options. We’re here to help you plan with confidence. Give us a call at 561-395-6800 or fill out our contact form and we will be in touch to schedule a time that works for you.