After you die, any shared property you own typically belongs to your spouse. However, in some circumstances, you may put the property in a trust before your death.
Using a qualified terminable interest property trust is one method of doing so.
How it works
According to The National Law Review, many couples choose to plan for future asset distribution by setting up trusts. A QTIP trust helps provide financial stability for your spouse while keeping your assets safe for your beneficiaries at a later time. The rigidity of this trust means you do not have to worry about your surviving spouse withdrawing funds or misusing assets.
The legal guidelines in place make it impossible for the surviving spouse to change your wishes after you die. In addition, this process delays any estate taxes until after both spouses die, which means it can be a frugal choice for those who wish to avoid losing part of their assets to taxes.
Why choose it
Many people who remarry may opt for this trust. If your spouse has children from a previous marriage who you do not wish to include in this process, this trust keeps your estate from going to them against your wishes. You can ensure your spouse is financially comfortable while still preventing any other relatives from obtaining your assets.
The property held in a trust for your surviving spouse makes your decision the final one, which allows you a higher degree of control over the final beneficiaries than many other kinds of marital trusts. To streamline the process, seek out a trustee who you can depend on to fulfill your wishes.