A qualified domestic trust (QDOT), under certain circumstances, can be a very important estate planning option for your spouse. It is important to understand what this kind of trust does in order to determine if this kind of trust is the right for you, and to follow all formalities without triggering a substantial tax bill.
Parman & Easterday can assist you in determining if a QDOT makes sense for you and your family. You cannot afford to lose a substantial portion of your estate to the IRS, instead of allowing your spouse to have full access to your assets. If you and your family may need a QDOT, Parman & Easterday is here to help.
Do You Need A Qualified Domestic Trust?
A qualified domestic trust can help transfer larger estates to a non-citizen spouse without your estate being subject to the estate tax.
Under IRS Rules, spouses are, generally, allowed to transfer assets directly to each other after death without the application of the estate tax. The IRS rule exists because there is a basic assumption that any asset or property not taxed after the death of the first spouse will be taxed after the death of the second spouse.
However, the assumption changes if the surviving spouse is not a United States citizen. Under these circumstances, there is a concern that non-citizen spouses could leave the country without the IRS collecting applicable estate taxes. To avoid this from occurring, when assets in excess of the tax-free amount are left to a non-citizen spouse, the excess transferred assets can be taxed.
These taxes could be avoided through the use of a Qualified Domestic Trust. Therefore, if you have a non-citizen spouse and your assets exceed $5.49 million (as of 2017), then you should consider creating a Qualified Domestic Trust. Conversely, if the value of your estate is well below $5.49 million, if your spouse is a United States citizen, or if you are leaving your assets to someone other than your spouse, a QDOT may not be appropriate for your planning.
Getting Legal Help With Creating A Qualified Domestic Trust
If you think you may need a QDOT, contact Parman & Easterday today. Our legal team can carefully review your situation and advise whether a QDOT is right for you. We can also advise you on any other estate planning matter.
You do not want your spouse facing a reduced quality of life or value property solely because of your death. A substantial amount of money could be at stake if these issues are not appropriately addressed. Let our legal team assist you create a legally valid trust that provides the protections you need for your assets.
Contact An Estate Planning Lawyer Today
While a QDOT is one possible tool for protecting your assets, there are many different kinds of trusts that could be a part of your estate plan. You need the right tools in place to protect you and your family. Parman & Easterday can help.
To find out more about the estate planning process, join us for a free seminar. You can also give us a call today at (405) 843-6100 or contact us online to get personalized advice from an estate planing attorney. Call today to find out how we can help.
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