QDOT


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AcronymDefinition
QDOTQualified Domestic Trust (estate planning)
QDOTQueensland Department of Transport
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If the life insurance policy is structured properly, the death benefit will not be included in the resident spouse's estate, and the surviving spouse would have full access to the funds without the need for a QDOT.
A QDOT with assets of less than $2,000,000 must either (a) meet one of the requirements for a trust exceeding $2,000,000, or (b) provide that (1) no more than 35% of the fair market value (determined annually on last day of trust's taxable year) of assets consists of real property located outside the U.
citizen, and whose payments cannot be assigned to a QDOT because of federal, state, or foreign law, or because of the terms of the plan, annuity, or other arrangement (a "nonassignable annuity or other arrangement"--see, for example, Q 351) will be treated as meeting the QDOT requirements if the executor of the decedent spouse's estate submits an agreement by the noncitizen surviving spouse to either (1) remit deferred estate tax on the corpus portion of each annuity payment, or (2) roll over the corpus portion of each annuity payment to a QDOT.
The requirements for a QDOT are: (1) there must be an irrevocable election for QDOT treatment; (2) the trust must require that at least one trustee be a U.
No marital deduction is allowed unless the property is transferred to a QDOT, or a trust reformed to qualify as a QDOT, or it is transferred to the QDOT by a surviving spouse, or the surviving spouse becomes a citizen, or there is a treaty.
Property passing to a QDOT must meet the criteria for qualified terminable interest property under IRC section 2056(b)(7) or otherwise qualify for the marital deduction under IRC section 2056 (Treasury Regulations section 20.
Consequently, the executor will compute a DSUE amount on a preliminary basis on the decedent's estate tax return for purposes of electing portability, and this amount will subsequently be redetermined on the final distribution from the QDOT or other taxable event on which the estate tax under Sec.
citizen or a domestic corporation, and the trust must provide that no distribution of principal be permitted unless such trustee may withhold from the distribution a special QDOT tax.
32) A QDOT is defined as any trust that satisfies the following:
A QDOT allows a marital deduction and defers the estate tax on the first spouse's death while assuring that the estate tax will eventually be collected when either subsequent distributions of principal are made or when the second spouse dies.
If property passes directly from the decedent to the surviving spouse, it will be treated as passing to a QDOT if the property is transferred to the QDOT before the decedent's estate tax return is filed or the property is irrevocably assigned to the trust under an irrevocable assignment made on or before the date the return is filed (Sec.
The estate tax as calculated under the QDOT rules generally is deferred until distributions are made from the trust or upon the death of the surviving spouse.