Quick Definition

A QTIP Trust is a type of irrevocable trust that allows the grantor to provide for a surviving spouse and maintain control over how the trust's assets are distributed once the surviving spouse dies.

Examples

• 1A husband sets up a QTIP Trust to ensure his wife receives income for life, but designates that the principal will go to his children from a previous marriage after her death.
• 2A wealthy individual uses a QTIP Trust to minimize estate taxes by providing her spouse with income generated from the trust while leaving the remaining assets to a charitable organization.
• 3An elderly person establishes a QTIP Trust to support a second spouse with the trust income, while ensuring that the family home reverts to his children from his first marriage upon the spouse's passing.

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