In 1985,Drew creates a trust with $1,000,000 of securities.Under the terms of the trust,Paula (Drew's wife)is granted a life estate with remainder to their children.Drew makes a QTIP election as to the trust.Drew dies in 1992 when the trust is worth $1,500,000,and Paula dies in 2008 when the trust is worth $2,000,000.Which,if any,of the following is a correct statement?

Question

Quizplus · Accepted Answer

Nothing is included in Drew's gross estate when he dies as he neither controls the trust nor owns its assets (choice a.).Drew gets a gift tax marital deduction when he creates the trust,not an estate tax marital deduction when he dies (choice c.).The value of the trust,due to the QTIP election,is included in Paula's gross estate when she dies (choice d.as opposed to choice b.).

In 1985,Drew Creates a Trust with $1,000,000 of Securities