Originally Posted by Brat
Update: We consulted an attorney who said that a "revocation trust" is a common term for a Credit Shelter Trust.
Our Credit Shelter Trust is now the contingent beneficiary on each IRA while the spouse is the primary beneficiary. The first to die disclaims to the benefit of the named credit shelter trust within 9 months. The assets in the credit shelter trust are not counted in the estate of the survivor although the survivor can use the income and must take the RMDs.
When the last to die passes our joint revocable family trust becomes irrevocable.
Strange, I can't see how "revocation trust" can be described as a common term when I do not see any google search result for that term.
I'm interested in this because we did something similar. Could you clarify a few things:
-Is it your intent that the survivor of the first spouse to die will disclaim IRA assets to the trust, so that the assets are outside of the estate when the survivor dies? If this is the case, why don't you just name the trust as the primary beneficiary?
-Do you know whether the assets, when passing into the trust upon the death of the first spouse would qualify for the spousal estate tax exemption?
-Are you stating that the trust will remain revocable between the death of the 1st to die and surviving spouse? If so, it seems very strange the assets would not be counted in the estate of the surviving spouse.
-Was the term "QTIP qualified" used to describe the trust?