Berdon Blogs

T&E TALK: Second Marriage and Your Estate Plan – Keep the Kids in Mind

Posted by Scott T. Ditman, CPA/PFS on Mar 21, 2016 1:00:00 PM
Find me on:

Estate planning for a second or subsequent marriage can be complicated, especially if you have children from a previous marriage.  Finding the right planning technique can not only circumvent family tensions, it can also help you pass more assets to the children at a lower tax cost.

A qualified terminable interest property (QTIP) trust can maximize estate tax deferral while benefiting the surviving spouse for his or her lifetime and the children after the spouse’s death. You also can provide your spouse with as little or as much access to the trust’s principal as you choose.  Because of the marital deduction, no estate taxes are due at your death. But the entire value of the QTIP trust will be included in your spouse’s estate.  When you spouse dies, the remaining QTIP trust assets pass as the trust indicates, typically to your children.

Combining a QTIP trust with life insurance benefiting your children or creatively using joint gifts can further leverage your gifting ability.

Consider a prenuptial agreement to further help you achieve your estate planning goals and address your children’s needs.  A pre-nup requires that certain legal requirements be met, so it is essential to consult with an attorney.

Developing a second marriage estate plan can be both complicated and an emotional experience. If you have questions or are now ready to move forward, contact me at SDitman@berdonllp.com or your Berdon advisor.

Scott T. Ditman, a tax partner and Chair, Personal Wealth Services at Berdon LLP, advises high net worth individuals and family/owner-managed business clients on building, preserving, and transferring wealth, estate and income tax issues, and succession and financial planning.

Topics: T&E TALK

About Berdon Blogs

Our experts examine the latest trends, economics, business conditions and industry issues to provide timely information you need to maximize your tax advantages and meet your financial goals.

SALT TALK: Hear an insider’s perspective on the business issues, legislative updates in state and local tax, and tax aspects behind today’s headlines.

T&E TALK: Gain insights into how changes in tax laws, shifts in the financial markets, and regulatory concerns will impact assets and affect preserving and transferring wealth.

TAX TALK: Get an all-inclusive perspective on regulatory changes, industry issues, and trends from our team of multidisciplinary tax professionals – many of whom also hold J.D. and LL.M degrees.

Subscribe to Berdon Blogs

Recent Posts