Estates

Yes. But you are using the wrong terms. You can leave 50% to each of two beneficiaries. The second will no longer be called the "contingent" beneficiary.

I'm sure many learned accountants and attorneys can find fault with this answer, but it is going to be too long even with this simplified version.

What is a QTIP:

To understand a Reverse QTIP, you must first know what a QTIP is. A QTIP trust is a Qualified Terminable Interest Property trust. This refers to the ability to give (either during life or at death) assets to your spouse in trust and not be subject to gift tax or estate taxes because a QTIP trust has special requirements from the Internal Revenue Code so that it qualifies for an unlimited marital deduction.

Lets say that Husband dies and leaves assets to Wife in trust. The Husband's estate will have to file a form 706 (estate tax return) with the IRS. If the trust meets certain qualifications set out by the IRS, then a QTIP election can be on the return. Any assets for which a QTIP election is made transfer to Wife in trust without any tax being assessed. If a QTIP election is not made, estate tax is assessed on the assets left in trust for Wife. It's that simple. As long as the trust qualifies, you make the QTIP election to get the unlimited marital deduction. All of those assets are now considered the assets of Wife.

A Different Tax the Reverse QTIP is used on:

Wealthy people used to often think, "If I give this money to my kids when I die, not only will I have to pay taxes on it, but when they die they will have to pay taxes on this money too. Why don't I just skip my kids and give it directly to my grandkids. That way we only have to pay the taxes once." That worked until the IRS figured out that they were missing out on a generation of estate taxes. Then they added the Generation Skipping Transfer (GST) Tax for any gift that skips a generation.

Where a "Reverse" QTIP Comes In:

Just like the estate tax has a credit amount and the gift tax has a credit amount, the IRS also gives each of us a credit to apply to the GST. Husband has one GST credit and Wife has one GST credit. However, if husband has given all assets to wife on death, he has not used his credit. Now only Wife's credit is left for any assets passing on to grandchildren. One of the credits the couple could have used has been, in essence, torn up and thrown away.

You will recall that above I mentioned that an election must be made on form 706 (a QTIP election) to get the unlimited marital deduction. What happens if that election is not made? If the QTIP election is not made, any assets that pass on to grandchildren will be considered as Husband's for GST credit purposes but taxes will have to be paid on whatever is given to Wife.

Here's where it gets tricky. At the same time the QTIP election is made for estate tax purposes, another election can be made "reversing" that QTIP election for the purposes of the Generation Skipping Transfer Tax. Therefore you have the benefit of both credits. The property gets a QTIP election for estate tax purposes but is still considered as Husband's for GST credit purposes. That way the property gets the unlimited marital deduction, but Husband still gets to use his GST credit.

Separate Reverse QTIP Trust:

When the QTIP election is reversed for GST purposes, it must be reversed for the entire set of assets in the trust. Typically the QTIP trust will be much larger than the GST credit amount will cover. (Remember the QTIP marital deduction is "unlimited.") Therefore, good planners will often create two QTIP trusts. One trust is just the right amount on which to "Reverse" the QTIP election for purposes of taking the GST credit. The rest (unlimited amount) gets dumped into the other QTIP trust that will not be reversed. Therefore, the smaller trust is called a "Reverse QTIP" Trust.

In summary, a Reverse QTIP Trust is a QTIP trust that is created in the anticipation that the amount placed in the trust will have the QTIP election reversed for GST purposes so that it still qualifies for the Husband's GST credit. In doing so, the credits of both spouses get to be used. If this planning is not done, only the last one to die gets to use their GST credit.

Yes

it remains a grantor trust

A "life partner" has no legal rights under the law unless there is a registered civil union or legal marriage in those states that allow same. That is why it is so important for "life partners" to do estte planning and have wills drafted by a professional. In this case the children would be heirs-at-law unless the decedent had a will that named the life partner as the beneficiary.

Nothing.

I can't answer your question, but we may be in the same boat, unfortunately. Email me if you like, on RaciePSB@aol.com.au.

The estate pays all debts first and then distributes the assets.

So yes they can.

A 'deceased beneficiary' is the beneficiary of a life insurance policy or a 'payable on death' bank account who predeceased the insured or the account owner.

A 'deceased beneficiary' could also be a beneficiary named in a will who predeceased the testator or who died during the probate of the estate.

An Indian raga, is the melody, that is played with the chords. For example: A and D.

If the heir is indebted to the estate their indebtedness will be deducted from any inheritance they receive under the will. For example, suppose you borrowed $10,000 from your grandfather to buy a car and you signed a promissory note. He died and left you $15,000 in his will but did not mention the loan. Your debt would be owed to his estate and would be deducted from your $15,000.

If on the other hand the beneficiary simply has a great amount of personal debt, it has no affect on how much they would inherit under a will. A gift from a testator is set forth in the will and your personal financial condition has no effect on your gift whatsoever unless your creditors find the estate and freeze your inheritance.

The town will take possession of the property for delinquent taxes, file a petition in court to acquire title and then the town will sell the property.

You haven't said whether your mother has died. If not, her will should be drafted by an attorney who specializes in probate law. A will that omits a child must be drafted properly: The child should be specifically mentioned so the court will not assume he was simply forgotten. If not that child or their children may have a claim against the estate depending on state laws. If your brother had no children, it is doubtful that his wife could prevail in a claim against your mother's estate.

No. If you think the executor has misused their authority it should be reported to the court that made the appointment. The court will review the matter and issue a decision. An executor can be held personally liable for mismanaging the estate.

You should contact the legal department of the insurance company and ask for its advice. The company may initiate a search for the beneficiary with the resources at its disposal.

You should consult with an attorney who specializes in probate law in your area ASAP. The proceeds may have transferred to his parents' estates. In that case, the proceeds would pass under their wills or under the state laws of intestacy to their heirs at law. The attorney must review the policy, whether it was owned by your husband's estate and your state laws. You may need to take the matter to court.

You must file a petition in the county probate court. You can perform a quick search for the location in your jurisdiction by searching your county, state + probate court. For example: Middlesex County, MA - probate court.

No. The owner of the retirement fund would need to have the legal capacity to make that change. You can't change their will either. It is disturbing to think that after a person has decided who should receive their property after their death, someone would come along and think they could change it after they have become legally incapacitated.

The notary must be acceptable to the jurisdiction where the documents will be used for legal purposes. Therefore the Canadian citizen should check with the entity that will receive the documents to determine if the NY notary will be acceptable.

With the exception of people that die in 2010 (because the estate tax is repealed for this one year period), the answer is yes. Estate taxes and the effect of life and remainder estates can be very complicated. There are also generation skipping tax issues. I encourage you to consult a knowledgable professional.

A check made payable to the estate of a deceased person can be a problem. Legally, it must be cashed by the court appointed estate representative, i.e., the executor or administrator. If there is no other property owned by the decedent and no probate was filed, and if the decedent owned a joint bank account with another person, the bank may allow the check to be deposited in that account. However, if that doesn't work then a probate will need to be filed to establish the identity of the person who can legally cash the check.

It is illegal for a notary to prepare a trust. They are not authorized to practice law and the establishment of a trust fits that category.