A Qualified Terminable Interest Property (QTIP) trust lets you provide financial support for your surviving spouse and still control where your estate goes. This trust structure works well when you want to support a spouse while protecting long-term goals for children or other beneficiaries.
Ensures asset protection for children
QTIP trusts work especially well in blended families. You name your spouse as the lifetime beneficiary, giving them income from the trust for life. After your spouse passes away, the remaining assets go to the beneficiaries you choose—often your children from a previous relationship.
This structure reduces the chance of conflict and ensures your wealth goes where you intend. It offers more certainty than a simple will.
Defers estate taxes effectively
A QTIP trust allows you to defer federal estate taxes. When you transfer assets into the trust, they qualify for the unlimited marital deduction. This delays taxation until your spouse dies. At that point, the IRS includes the trust assets in your spouse’s estate.
This strategy benefits larger estates by preserving wealth and maintaining control over its final distribution.
Offers strategic control beyond a will
With a QTIP trust, you define how the trustee manages and distributes your assets. You decide how much income your spouse receives and when distributions happen. You choose a trustee who carries out your instructions.
This structure helps if you worry about your spouse’s spending habits or the chance they might remarry. The trust keeps your estate plan in place without changes.
QTIP trusts offer a smart solution when your family includes children from prior relationships. You can support your spouse and protect your children’s inheritance. This type of trust helps you manage financial responsibility and maintain family stability.