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<p class="MsoNormal"><span style="font-size:16.0pt">Great feedback Joshua,<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">If we only had such easy cases right? I really appreciate your direction on beneficiary designations as well – sometimes there is no other choice but to use QP assets for funding –
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">It’s never dull………<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
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<p class="MsoNormal"><i><span style="font-size:11.0pt;font-family:"Script MT Bold"">Diane J. Kiepe<o:p></o:p></span></i></p>
<p class="MsoNormal"><i><span style="font-size:11.0pt;font-family:"Script MT Bold""><o:p> </o:p></span></i></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Diane J. Kiepe<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Douglas Eden<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">717 W. Sprague Ave.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Suite 1500<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Spokane, WA 99201<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt"><a href="mailto:djkiepe@depdslaw.com"><span style="color:#0563C1">djkiepe@depdslaw.com</span></a><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">509-455-5300<o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:11.0pt">From:</span></b><span style="font-size:11.0pt"> wsbapt-bounces@lists.wsbarppt.com <wsbapt-bounces@lists.wsbarppt.com>
<b>On Behalf Of </b>Joshua McKarcher<br>
<b>Sent:</b> Thursday, June 23, 2022 3:31 PM<br>
<b>To:</b> WSBA Probate & Trust Listserv <wsbapt@lists.wsbarppt.com><br>
<b>Subject:</b> Re: [WSBAPT] Community Property/Marital Trust Questions<o:p></o:p></span></p>
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<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">Wonderful outline, Diane, thank you! My clients in these categories have presented even more lopsided scenarios: like Natalie’s, with the surviving spouse holding far more
than half the estate’s value in qualified funds. Ugh. A promissory note may work, but she’ll have to “see” if so in the given case.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">If the legislature dislikes lawyers, it should enact portability like the federal government has; but then it would lose tons of estate tax revenue from those who do not
plan to “use” the exemption of the first spouse to die intestate or with “simple” “I love you” wills.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">In this case, the IRA beneficiary designations left much to be desired. Although I may be burned at the stake for saying this, I actually prefer the
<u>option</u> in these lopsided cases of directing IRA assets to a properly built trust, with the option for a disclaimer out (to a different subtrust or the surviving spouse individually) if that option is undesirable when the day comes. (Who knows the future
well enough to know that an income-tax hit won’t in some cases be preferable to a future estate (or other) tax hit. Options are good.)<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">With the IRA designations Natalie is faced with, she will indeed have fewer options. Taking Diane up on the call is a good start. Good luck!
</span><span style="font-size:12.0pt;font-family:"Segoe UI Emoji",sans-serif">😊</span><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">Best, Josh<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">Joshua D. McKarcher<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">McKarcher Law PLLC<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">537 6th Street<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">Clarkston, WA 99403<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">(509) 758-3345<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif">(509) 758-3314 (fax)<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><a href="mailto:josh@mckarcherlaw.com"><span style="color:blue">josh@mckarcherlaw.com</span></a><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><a href="http://www.mckarcherlaw.com"><span style="color:blue">www.mckarcherlaw.com</span></a></span><span style="font-size:11.0pt"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:11.0pt">From:</span></b><span style="font-size:11.0pt">
<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">wsbapt-bounces@lists.wsbarppt.com</a> <<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">wsbapt-bounces@lists.wsbarppt.com</a>>
<b>On Behalf Of </b>Diane J. Kiepe<br>
<b>Sent:</b> Thursday, June 23, 2022 3:34 PM<br>
<b>To:</b> WSBA Probate & Trust Listserv <<a href="mailto:wsbapt@lists.wsbarppt.com">wsbapt@lists.wsbarppt.com</a>><br>
<b>Subject:</b> Re: [WSBAPT] Community Property/Marital Trust Questions<o:p></o:p></span></p>
</div>
</div>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-size:16.0pt">Natalie and Phil,<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">The joys of community property laws!
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">You cannot ignore community property laws – let me give the most elementary of examples:<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">H&W have a 3.0M combined Estate. Wife (CEO of Going Places Inc.;)) has a retirement plan at 1.5M accumulated during the course of the marriage, they have a home worth 1.0 and an investment account of $500,000.
H dies and Will directs Marital Trust. How much is the trust funded with? 1.5M – but the amount should be funded on a non-pro rata basis see below:<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">Property H CP Share Outright to SS To Trust<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">House $500,000.00 $0.00 $1,000,000.00<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">Investments $250,000.00 $0.00 $500,000.00<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">QP $750,000.00 $1,500,000.00<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">You say, Diane that’s terrible, a house in the trust – what a pain and of course you potentially loose Code Section 121 Income Exclusion. You’re right so, in the above, I would recommend by spouse buy the
property from the trust – no gain and now trust still has amount it’s supposed to (1.5M), ss has benefits (and burdens of ownership), any future appreciation has the benefit of Code Section 121 income exclusion, etc. etc.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">Note, what is key above is that the QP is in the survivor’s name and thus the decedent’s ½ interest “counts” towards the value of his estate and as such greater funding (which is usually a good thing right
now and especially in blended families where first to die has a true desire to keep corpus for first kids).
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">We never want to uses any type of pre-tax QP for funding a trust and I have even used promissory notes from the survivor to the trust to avoid having to liquidate a plan in part to fund.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt">Natalie, still happy to have a visit – I’m open some this weekend – and various times next week.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"> <o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
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<p class="MsoNormal"><i><span style="font-size:11.0pt;font-family:"Script MT Bold"">Diane J. Kiepe<o:p></o:p></span></i></p>
<p class="MsoNormal"><i><span style="font-size:11.0pt;font-family:"Script MT Bold""><o:p> </o:p></span></i></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Diane J. Kiepe<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Douglas Eden<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">717 W. Sprague Ave.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Suite 1500<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Spokane, WA 99201<o:p></o:p></span></p>
<p class="MsoNormal"><a href="mailto:djkiepe@depdslaw.com"><span style="font-size:11.0pt">djkiepe@depdslaw.com</span></a><span style="font-size:11.0pt"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:11.0pt">509-455-5300<o:p></o:p></span></p>
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<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
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<p class="MsoNormal"><b><span style="font-size:11.0pt">From:</span></b><span style="font-size:11.0pt">
<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">wsbapt-bounces@lists.wsbarppt.com</a> <<a href="mailto:wsbapt-bounces@lists.wsbarppt.com">wsbapt-bounces@lists.wsbarppt.com</a>>
<b>On Behalf Of </b>Natalie Kuehler<br>
<b>Sent:</b> Thursday, June 23, 2022 12:23 PM<br>
<b>To:</b> WSBA Probate & Trust Listserv <<a href="mailto:wsbapt@lists.wsbarppt.com">wsbapt@lists.wsbarppt.com</a>><br>
<b>Subject:</b> Re: [WSBAPT] Community Property/Marital Trust Questions<o:p></o:p></span></p>
</div>
</div>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro"">Yes, Phil, that’s the question!<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro"">And the same question applies for W’s own IRA (since if she is required to place 50% of all community assets in the trust then that would include a portion of her IRA, too, since
that IRA alone holds more than half the value of all of the community assets).<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""><o:p> </o:p></span></p>
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<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:12.0pt;font-family:"Chaparral Pro";color:#060A2E">Natalie N. Kuehler</span><span style="font-size:12.0pt;color:black"><o:p></o:p></span></p>
<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:12.0pt;font-family:"Chaparral Pro";color:#060A2E"><o:p> </o:p></span></p>
<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:11.0pt;font-family:"Chaparral Pro";color:#060A2E">CONFIDENTIALITY STATEMENT: This message contains information that may be confidential and protected by the attorney-client
privilege. If you received this message in error, please notify the sender immediately and delete the message.</span><span style="font-size:11.0pt"><o:p></o:p></span></p>
</div>
</div>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""><o:p> </o:p></span></p>
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<p class="MsoNormal" style="margin-bottom:12.0pt"><b><span style="font-size:12.0pt;color:black">From:
</span></b><a href="mailto:wsbapt-bounces@lists.wsbarppt.com"><span style="font-size:12.0pt">wsbapt-bounces@lists.wsbarppt.com</span></a><span style="font-size:12.0pt;color:black"> <</span><a href="mailto:wsbapt-bounces@lists.wsbarppt.com"><span style="font-size:12.0pt">wsbapt-bounces@lists.wsbarppt.com</span></a><span style="font-size:12.0pt;color:black">>
on behalf of Philip N. Jones <</span><a href="mailto:pjones@duffykekel.com"><span style="font-size:12.0pt">pjones@duffykekel.com</span></a><span style="font-size:12.0pt;color:black">><br>
<b>Date: </b>Thursday, June 23, 2022 at 12:17 PM<br>
<b>To: </b>WSBA Probate & Trust Listserv <</span><a href="mailto:wsbapt@lists.wsbarppt.com"><span style="font-size:12.0pt">wsbapt@lists.wsbarppt.com</span></a><span style="font-size:12.0pt;color:black">><br>
<b>Subject: </b>Re: [WSBAPT] Community Property/Marital Trust Questions<o:p></o:p></span></p>
</div>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">I would like to ask a dumb question.</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">In this case, can the wife use part of H’s IRA to fund the marital (bypass) trust, or is she required to do that?</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Or can she simply look the other way and accept the benefits of husband’s IRA as the beneficiary and postpone the withdrawals to the extent permitted by the RMD rules?</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">I guess what I am asking is whether wife can ignore the community property laws?</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Is that the question?</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Phil Jones</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif"> </span><o:p></o:p></p>
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<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Philip N. Jones</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Duffy Kekel LLP</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">900 S.W. Fifth Ave. Suite 2500</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Portland, OR 97204</span><o:p></o:p></p>
<p class="MsoNormal"><a href="mailto:pjones@duffykekel.com"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">pjones@duffykekel.com</span></a><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">(503) 226-1371 – office</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">(503) 853-1482 – cell</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">(503) 226-3574 - fax</span><o:p></o:p></p>
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<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif"> </span><o:p></o:p></p>
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<p class="MsoNormal"><b><span style="font-size:11.0pt">From:</span></b><span style="font-size:11.0pt">
</span><a href="mailto:wsbapt-bounces@lists.wsbarppt.com"><span style="font-size:11.0pt">wsbapt-bounces@lists.wsbarppt.com</span></a><span style="font-size:11.0pt"> <</span><a href="mailto:wsbapt-bounces@lists.wsbarppt.com"><span style="font-size:11.0pt">wsbapt-bounces@lists.wsbarppt.com</span></a><span style="font-size:11.0pt">>
<b>On Behalf Of </b>Diane J. Kiepe<br>
<b>Sent:</b> Thursday, June 23, 2022 10:11 AM<br>
<b>To:</b> WSBA Probate & Trust Listserv <</span><a href="mailto:wsbapt@lists.wsbarppt.com"><span style="font-size:11.0pt">wsbapt@lists.wsbarppt.com</span></a><span style="font-size:11.0pt">><br>
<b>Subject:</b> Re: [WSBAPT] Community Property/Marital Trust Questions</span><o:p></o:p></p>
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<p class="MsoNormal"> <o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:16.0pt">Natalie,</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:16.0pt"> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:16.0pt">I have dealt with this issue several times and it would be difficult to explain by e-mail but I would be happy to chat with you on my approach. The Limited Power of Appointment in favor of spouse has no bearing
on Marital vs Bypass but, if the language allows for the Martial Trust to make varying QTIP elections you are going to want to consider (based on make up of other assets) a 100% Federal QTIP and 0% State QTIP since you have a filing requirement for the state
anyway.</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:16.0pt"> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:16.0pt">If you’d like to dialogue, let me know.</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:16.0pt"> </span><o:p></o:p></p>
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<p class="MsoNormal"><i><span style="font-size:11.0pt;font-family:"Script MT Bold"">Diane J. Kiepe</span></i><o:p></o:p></p>
<p class="MsoNormal"><i><span style="font-size:11.0pt;font-family:"Script MT Bold""> </span></i><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Diane J. Kiepe</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Douglas Eden</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:11.0pt">717 W. Sprague Ave.</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Suite 1500</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:11.0pt">Spokane, WA 99201</span><o:p></o:p></p>
<p class="MsoNormal"><a href="mailto:djkiepe@depdslaw.com"><span style="font-size:11.0pt">djkiepe@depdslaw.com</span></a><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:11.0pt">509-455-5300</span><o:p></o:p></p>
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<p class="MsoNormal"><b><span style="font-size:11.0pt">From:</span></b><span style="font-size:11.0pt">
</span><a href="mailto:wsbapt-bounces@lists.wsbarppt.com"><span style="font-size:11.0pt">wsbapt-bounces@lists.wsbarppt.com</span></a><span style="font-size:11.0pt"> <</span><a href="mailto:wsbapt-bounces@lists.wsbarppt.com"><span style="font-size:11.0pt">wsbapt-bounces@lists.wsbarppt.com</span></a><span style="font-size:11.0pt">>
<b>On Behalf Of </b>Natalie Kuehler<br>
<b>Sent:</b> Wednesday, June 22, 2022 5:52 PM<br>
<b>To:</b> WSBA Probate & Trust Listserv <</span><a href="mailto:wsbapt@lists.wsbarppt.com"><span style="font-size:11.0pt">wsbapt@lists.wsbarppt.com</span></a><span style="font-size:11.0pt">><br>
<b>Subject:</b> Re: [WSBAPT] Community Property/Marital Trust Questions</span><o:p></o:p></p>
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<p class="MsoNormal"> <o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro"">Thank you!</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro"">Yes, all income to W; discretionary principal to W under HEMS standard.</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro"">Yes, the limited power of appointment is testamentary only, i.e. exercisable at death.</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro"">Does W still need to fund the Marital Trust with a full $3m, which will include part of W’s IRA, or is there a way to get around that?</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro"">Natalie</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""> </span><o:p></o:p></p>
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<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:12.0pt;font-family:"Chaparral Pro";color:#060A2E">Natalie N. Kuehler</span><o:p></o:p></p>
<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:12.0pt;font-family:"Chaparral Pro";color:#060A2E"> </span><o:p></o:p></p>
<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:11.0pt;font-family:"Chaparral Pro";color:#060A2E">CONFIDENTIALITY STATEMENT: This message contains information that may be confidential and protected by the attorney-client
privilege. If you received this message in error, please notify the sender immediately and delete the message.</span><o:p></o:p></p>
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<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""> </span><o:p></o:p></p>
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<p class="MsoNormal" style="margin-bottom:12.0pt"><b><span style="font-size:12.0pt;color:black">From:
</span></b><a href="mailto:wsbapt-bounces@lists.wsbarppt.com"><span style="font-size:12.0pt">wsbapt-bounces@lists.wsbarppt.com</span></a><span style="font-size:12.0pt;color:black"> <</span><a href="mailto:wsbapt-bounces@lists.wsbarppt.com"><span style="font-size:12.0pt">wsbapt-bounces@lists.wsbarppt.com</span></a><span style="font-size:12.0pt;color:black">>
on behalf of Philip N. Jones <</span><a href="mailto:pjones@duffykekel.com"><span style="font-size:12.0pt">pjones@duffykekel.com</span></a><span style="font-size:12.0pt;color:black">><br>
<b>Date: </b>Wednesday, June 22, 2022 at 5:46 PM<br>
<b>To: </b>WSBA Probate & Trust Listserv <</span><a href="mailto:wsbapt@lists.wsbarppt.com"><span style="font-size:12.0pt">wsbapt@lists.wsbarppt.com</span></a><span style="font-size:12.0pt;color:black">><br>
<b>Subject: </b>Re: [WSBAPT] Community Property/Marital Trust Questions</span><o:p></o:p></p>
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<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">What are the other terms of the marital trust? All income to W? Discretionary principal to W under a HEMS standard?</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Does the limited power of appointment apply only after W dies? In other words, is it testamentary, exercisable at her death?</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">I believe that the marital trust can be used as a bypass trust. Just don’t make a QTIP election, except perhaps for the portion in excess of the Washington exemption.</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Phil Jones</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif"> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif"> </span><o:p></o:p></p>
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<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Philip N. Jones</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Duffy Kekel LLP</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">900 S.W. Fifth Ave. Suite 2500</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Portland, OR 97204</span><o:p></o:p></p>
<p class="MsoNormal"><a href="mailto:pjones@duffykekel.com"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">pjones@duffykekel.com</span></a><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">(503) 226-1371 – office</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">(503) 853-1482 – cell</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">(503) 226-3574 - fax</span><o:p></o:p></p>
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<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif"> </span><o:p></o:p></p>
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<p class="MsoNormal"><b><span style="font-size:11.0pt">From:</span></b><span style="font-size:11.0pt">
</span><a href="mailto:wsbapt-bounces@lists.wsbarppt.com"><span style="font-size:11.0pt">wsbapt-bounces@lists.wsbarppt.com</span></a><span style="font-size:11.0pt"> <</span><a href="mailto:wsbapt-bounces@lists.wsbarppt.com"><span style="font-size:11.0pt">wsbapt-bounces@lists.wsbarppt.com</span></a><span style="font-size:11.0pt">>
<b>On Behalf Of </b>Natalie Kuehler<br>
<b>Sent:</b> Wednesday, June 22, 2022 4:14 PM<br>
<b>To:</b> </span><a href="mailto:wsbapt@lists.wsbarppt.com"><span style="font-size:11.0pt">wsbapt@lists.wsbarppt.com</span></a><span style="font-size:11.0pt"><br>
<b>Subject:</b> [WSBAPT] Community Property/Marital Trust Questions</span><o:p></o:p></p>
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<p class="MsoNormal"><span style="font-size:12.0pt"> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black">Hello all,</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black"> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black">I am sure the answers to this are straightforward, but I can’t seem to think this one through properly:</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black"> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black">I have an estate that consists entirely of community property valued at $6m. Of that, $4m is held in IRAs, $3.6m of which is in an IRA in W’s name only; the remaining
$400k in an IRA in H’s name only. The IRAs name the other spouse as a beneficiary. H dies, and in his Will leaves all of his interest in the couple’s community property to a Marital Trust, the initial beneficiary of which is W. The Marital Trust contains a
limited power of appointment for W (to H and W’s daughter or charitable organizations only). This raises the following questions:</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black"> </span><o:p></o:p></p>
<ol style="margin-top:0in" start="1" type="1">
<li class="MsoNormal" style="color:black;mso-list:l1 level1 lfo3"><span style="font-size:12.0pt;font-family:"Chaparral Pro"">Does the limited power of appointment prevent treatment of the Marital Trust as a bypass trust for WA estate tax purposes?</span><o:p></o:p></li><li class="MsoNormal" style="color:black;mso-list:l1 level1 lfo3"><span style="font-size:12.0pt;font-family:"Chaparral Pro"">Does the Marital Trust need to funded with $3m in assets (1/2 of all of the community property), or can it be funded with less? Specifically,
can all of W’s IRA stay in her name, or does a portion of that need to be transferred to the Marital Trust because that IRA alone makes up more than 50% of the community property? I am trying to avoid that result given the negative tax consequences that would
be triggered.</span><o:p></o:p></li></ol>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black"> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black">Any pointers – or referrals – would be greatly appreciated.</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black">Thank you!</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black"> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black">Natalie</span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""> </span><o:p></o:p></p>
<p class="MsoNormal"><span style="font-size:12.0pt;font-family:"Chaparral Pro""> </span><o:p></o:p></p>
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<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:11.0pt;font-family:"Chaparral Pro";color:#060A2E">Natalie N. Kuehler</span><o:p></o:p></p>
<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:12.0pt;font-family:"Chaparral Pro";color:#060A2E">THE KUEHLER LAW FIRM PLLC</span><o:p></o:p></p>
<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:11.0pt;font-family:"Chaparral Pro";color:#060A2E">PO Box 3059 – 1112 State Route 20</span><o:p></o:p></p>
<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:11.0pt;font-family:"Chaparral Pro";color:#060A2E">Winthrop, WA 98862</span><o:p></o:p></p>
<p class="MsoNormal" align="center" style="text-align:center"><span style="font-size:11.0pt;font-family:"Chaparral Pro";color:#060A2E">o: (509) 996-2832 x1 – c (509) 557-5769</span><o:p></o:p></p>
<p class="MsoNormal" align="center" style="text-align:center"><a href="https://nam11.safelinks.protection.outlook.com/?url=http%3A%2F%2Fwww.kuehlerlaw.com%2F&data=05%7C01%7Cpjones%40duffykekel.com%7C97972a5fcf554677f08908da553bb345%7C2d66ed5354fa4c2f8c4dbff1aca5479d%7C0%7C0%7C637916012210095654%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&sdata=D3Mq%2FgqU2GtrtqlGgduReixkv5%2BIPGo4IVO7m78INXM%3D&reserved=0"><span style="font-size:11.0pt;font-family:"Chaparral Pro"">www.kuehlerlaw.com</span></a><o:p></o:p></p>
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<p class="MsoNormal"><span style="font-size:11.0pt;font-family:"Chaparral Pro";color:#060A2E">CONFIDENTIALITY STATEMENT: This message contains information that may be confidential and protected by the attorney-client privilege. If you received this message
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