How Do You Draft A QTIP Trust Provision?
A “Qualified Terminal Interest Property” (commonly called QTIP) provision is a common tool in estate planning. The QTIP provision can be found in marital trusts (a trust formed for the benefit of a spouse). The combination of the provision and the trust makes the QTIP Marital Trust. The most common use of the QTIP Marital Trust is for blended families in which one spouse (the grantor) wishes to provide for children and/or grandchildren who are not a result of the current marriage. The QTIP provision in this trust says that the living spouse will receive income during his or her lifetime, but after the death of that spouse, the trust will benefit the children outside of the marriage (children from the current marriage can be included as well). This prevents the spouse from favoring any children over the other after the grantor’s death. An effective QTIP provision must be drafted correctly. A lawyer will draft the entire trust document, including this provision. Direct that all current i
