What is a qualified terminable interest property trust?
A qualified terminable interest property trust (QTIP) is a type of trust used in New Hampshire and other states to provide tax benefits and ensure that the deceased’s assets are distributed according to his or her wishes. A QTIP trust is created when someone is making a will, and it allows the grantor (the person who created the trust) to designate an income beneficiary to receive payments from the trust and a remainder beneficiary who will ultimately receive the remainder of the trust’s assets when the trust ends. In order for a trust to be considered a QTIP trust in New Hampshire, it must meet certain criteria. First, the trustee of the trust must be someone other than the grantor or the grantor’s spouse. Second, the trust must include a provision that prevents the income beneficiary from having any say in how the trust assets are managed or invested. Finally, after the income beneficiary’s death, the remainder of the trust assets must be distributed to the remainder beneficiary. QTIP trusts provide a number of benefits to the grantor, including the ability to protect the assets from creditors and ensure that the grantor’s wishes regarding the distribution of his or her assets are followed. They also provide tax benefits, as the income beneficiary will not have to pay taxes on the trust’s income until they receive the remainder of the trust’s assets. This can be particularly beneficial if the income beneficiary is in a lower tax bracket than the grantor.
Related FAQs
What is a testamentary trust?What are the rights of a surviving spouse?
What is the purpose of trust administration?
What is a revocable living trust?
What is the meaning of an executor?
What is the difference between a trust and a corporation?
What is the Uniform Probate Code?
What is a marital deduction trust?
What is the difference between a will and a trust?
What is a charitable trust?
Related Blog Posts
Understanding the Basics of Inheritance Laws: A Guide to Successfully Navigating State and Federal Statutes - July 31, 2023How to Ensure Your Estate Plan Reflects Your Wishes Through Inheritance Laws - August 7, 2023
Protect Your Rights as a Beneficiary: Understanding Your Legal Rights After Beneficiary Inheritance - August 14, 2023
Comprehending the Duties and Responsibilities of Executors of Estates: How to Properly Administer an Estate and Fulfill Inheritance Law Requirements - August 21, 2023
Maximizing the Benefits of Inheritance Law for Family Heirs of Estates - August 28, 2023