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</o:shapelayout></xml><![endif]--></head><body lang=EN-US link=blue vlink=purple><div class=WordSection1><p class=Body><font size=3 face="Times New Roman"><span style='font-size:12.0pt'>Speaking of QTIPs, here’s one: Surviving Spouse, beneficiary of QTIP and Credit Shelter Trusts, enters into agreement with remainder beneficiaries whereby SS receives all of QTIP plus a cash payment from CST in exchange for termination of both trusts and payment of remainder in CST to remainder beneficiaries. There are capital assets loss carryovers in QTIP attributable to prior securities sales from that trust in years past. Client is trustee of both trusts, and asks if losses can be allocated, in whole or in part, to remainder beneficiaries. My view is that since, pursuant to IRC Sec. 2056(b)(7) all QTIP income must pass to surviving spouse for life (she is still alive), losses must follow the assets, and are, in essence, a form of negative income which must be allocated entirely to SS. The theory additionally is that the losses can actually add to income by becoming tax deductions on distributed income and future gains on asset sales, as well as the logical idea that the losses must follow the assets distributed to SS. <o:p></o:p></span></font></p><p class=Body><font size=3 face="Times New Roman"><span style='font-size:12.0pt'>Anybody think the losses can be allocated to anyone other than the SS? <o:p></o:p></span></font></p><p class=MsoNormal><font size=3 face=Calibri><span style='font-size:12.0pt;font-family:"Calibri",sans-serif'><o:p> </o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>Samuel L. Furgason<o:p></o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>Samuel L. Furgason, Inc, PS<o:p></o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>(Not accepting new business)<o:p></o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>10655 N.E. 4<sup>th</sup> Street, Suite 701<o:p></o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>Bellevue, Washington 98004<o:p></o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>MAIL TO:<o:p></o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>PO Box 102<o:p></o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>Medina, WA 98039-0102<o:p></o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>Work: (425) 649-1122<o:p></o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>Cell: (425) 445-9909<o:p></o:p></span></font></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'>Email: sam@furgasons.com<o:p></o:p></span></font></p><p class=MsoNormal><font size=3 face=Calibri><span style='font-size:12.0pt;font-family:"Calibri",sans-serif'><o:p> </o:p></span></font></p><p class=Body><font size=3 face="Times New Roman"><span style='font-size:12.0pt'><o:p> </o:p></span></font></p><p class=Body><font size=3 face="Times New Roman"><span style='font-size:12.0pt'><o:p> </o:p></span></font></p><div><div style='border:none;border-top:solid #E1E1E1 1.0pt;padding:3.0pt 0in 0in 0in'><p class=MsoNormal><b><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;font-weight:bold'>From:</span></font></b><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'> wsbapt-bounces@lists.wsbarppt.com [mailto:wsbapt-bounces@lists.wsbarppt.com] <b><span style='font-weight:bold'>On Behalf Of </span></b>John J. Sullivan<br><b><span style='font-weight:bold'>Sent:</span></b> Friday, April 01, 2016 1:20 PM<br><b><span style='font-weight:bold'>To:</span></b> WSBA Probate & Trust Listserv <wsbapt@lists.wsbarppt.com><br><b><span style='font-weight:bold'>Subject:</span></b> Re: [WSBAPT] QDOT Planning in Washington<o:p></o:p></span></font></p></div></div><p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:12.0pt'><o:p> </o:p></span></font></p><div><p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:12.0pt'>Assuming the $5 million is CP, he only has to convert $500K of his share to her SP. <o:p></o:p></span></font></p></div><div id=AppleMailSignature><p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:12.0pt'><o:p> </o:p></span></font></p></div><div id=AppleMailSignature><p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:12.0pt'>Yes. There is no gift tax. Make sure it's segregated and stays her SP. he can even put it in an intervivos QTIP if he wants to control ultimate disposition and protect from her creditors. <o:p></o:p></span></font></p></div><div id=AppleMailSignature><p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:12.0pt'><o:p> </o:p></span></font></p></div><div id=AppleMailSignature><p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:12.0pt'>John Sullivan<br><br>Sent from my iPhone<o:p></o:p></span></font></p></div><div><p class=MsoNormal style='margin-bottom:12.0pt'><font size=3 face="Times New Roman"><span style='font-size:12.0pt'><br>On Apr 1, 2016, at 12:37 PM, Jacob Menashe <<a href="mailto:jacob@hickmanmenashe.com">jacob@hickmanmenashe.com</a>> wrote:<o:p></o:p></span></font></p></div><blockquote style='margin-top:5.0pt;margin-bottom:5.0pt'><div><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>The situation: Husband is a US citizen. Spouse is not. They are Washington residents and have $5,000,000. Can Husband, during life, give Spouse $1,000,000, and thus avoid a Washington QDOT since his half of the $4,000,000 left will just be $2,000,000. I’m scratching my head and thinking the answer is yes, but I doubt if it’s that easy. (And realize that may be the tenor of the responses I get!) All responses though are appreciated!</span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'> </span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>Thank you, </span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'> </span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>Jacob Menashe</span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'> </span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>_____________________________</span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>Jacob H. Menashe</span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>Hickman Menashe, PS</span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>4211 Alderwood Mall Blvd., Suite 202</span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>Lynnwood, WA 98036</span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>(425) 744-5658 phone</span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>(425) 744-6078 fax</span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'>Satellite Office in Bellevue</span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'><a href="www.hickmanmenashe.com"><font color="#0563c1"><span style='color:#0563C1'>www.hickmanmenashe.com</span></font></a></span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'> </span></font><o:p></o:p></p><p class=MsoNormal><font size=2 color="#1f497d" face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif;color:#1F497D'> </span></font><o:p></o:p></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'> </span></font><o:p></o:p></p><p class=MsoNormal><font size=2 face=Calibri><span style='font-size:11.0pt;font-family:"Calibri",sans-serif'> </span></font><o:p></o:p></p></div></blockquote><blockquote style='margin-top:5.0pt;margin-bottom:5.0pt'><div><p class=MsoNormal><font size=3 face="Times New Roman"><span style='font-size:12.0pt'>_______________________________________________<br>WSBAPT mailing list<br><a href="mailto:WSBAPT@lists.wsbarppt.com">WSBAPT@lists.wsbarppt.com</a><br><a href="http://mailman.fsr.com/mailman/listinfo/wsbapt">http://mailman.fsr.com/mailman/listinfo/wsbapt</a><o:p></o:p></span></font></p></div></blockquote></div></body></html>