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There are many varieties of Wills and Trusts to fit your needs. These
documents should only be drafted by a qualified attorney at law. A few
of the more common documents are listed below. Additional trusts may be
used for current income tax savings or to remove life insurance from the
taxable estate, but these trusts and wills are usually at the center of
an estate plan.
Basic Will
A basic or simple Will generally gives everything outright to a
surviving spouse, children, or other heirs. Sometimes called an "I
love you" Will.
Will with Contingent Trust
Frequently married couples with minor children will pass everything to
their spouse, if living, and if not, to a Trust for their minor children
until they become more mature.
Pour-over Will
The so-called "pour-over" Will is generally used in
conjunction with a Living Trust. It picks up any assets which were not
transferred to the Trust during the person's lifetime and
"pours" them into the Trust upon death. The assets will
generally be subject to probate administration, however.
Tax-Saving Will
A will may be used to create a Testamentary Credit Shelter Trust. This
Trust provides lifetime benefits to the surviving spouse, without
including these benefits in the surviving spouse's estate upon their own
death. This type of Will Trust permits a married couple to pass $1.2
million to their heirs without any Federal Estate Tax.
Living Trust without Tax Planning
Generally, the surviving spouse has full control of the principal and
income of this type of Trust. Its main purpose is to avoid probate and
perhaps manage the assets for beneficiaries who are not yet ready to
inherit the assets outright, because they still lack experience in
financial and investment matters.
Living Credit Shelter Trust
This type of Trust avoids probate and also makes certain that both
spouses use their Unified Credit. Estates up to $1.2 million can be
passed to children or other heirs, without probate expense or death tax,
by a married couple using this type of trust.
Living Credit Shelter/QTIP Trust
By adding another Trust to the Credit Shelter Trust (above), the first
spouse to die can determine the beneficiaries of his or her estate after
the surviving spouse dies.
For example, the income earned on assets in the Qualified Terminable
Interest Property (QTIP) Trust must be given to the surviving spouse for
his or her lifetime, but can then pass to the children of a prior
marriage of the first spouse to die.
Even if there are no children of a prior marriage, some estate owners
use this Trust to prevent a subsequent spouse of the survivor from
diverting the assets to themselves.
Additionally the QTIP permits deferral of death taxes on the assets
until the surviving spouse dies.
Qualified Domestic Trust
Asset-transfers at death to a non-citizen spouse do not qualify for the
Marital Deduction unless the assets pass to a Qualified Domestic Trust (QDOT).
The QDOT rules require that the trustee be a U.S. citizen, and have
other measures which help ensure that death taxes will be collected when
the surviving spouse dies.
 
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