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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?<o:p></o:p></span></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?<o:p></o:p></span></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.<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Phil Jones<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif"><o:p> </o:p></span></p>
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<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Philip N. Jones<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Duffy Kekel LLP<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">900 S.W. Fifth Ave. Suite 2500<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">Portland, OR 97204<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif"><a href="mailto:pjones@duffykekel.com"><span style="color:#0563C1">pjones@duffykekel.com</span></a><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">(503) 226-1371 – office<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">(503) 853-1482 – cell<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:14.0pt;font-family:"Times New Roman",serif">(503) 226-3574 - fax<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>Natalie Kuehler<br>
<b>Sent:</b> Wednesday, June 22, 2022 4:14 PM<br>
<b>To:</b> wsbapt@lists.wsbarppt.com<br>
<b>Subject:</b> [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:13.5pt;font-family:"Chaparral Pro";color:black">Hello all,</span><span style="font-size:13.5pt;color:black"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black"> </span><span style="font-size:13.5pt;color:black"><o:p></o:p></span></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><span style="font-size:13.5pt;color:black"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black"> </span><span style="font-size:13.5pt;color:black"><o:p></o:p></span></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><span style="font-size:13.5pt;color:black"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black"> </span><span style="font-size:13.5pt;color:black"><o:p></o:p></span></p>
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<li class="MsoNormal" style="color:black;mso-list:l1 level1 lfo3"><span style="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-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><span style="font-size:13.5pt;color:black"><o:p></o:p></span></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><span style="font-size:13.5pt;color:black"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black">Thank you!</span><span style="font-size:13.5pt;color:black"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black"> </span><span style="font-size:13.5pt;color:black"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:13.5pt;font-family:"Chaparral Pro";color:black">Natalie</span><span style="font-size:13.5pt;color:black"><o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-family:"Chaparral Pro""><o:p> </o:p></span></p>
<p class="MsoNormal"><span style="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:11.0pt;font-family:"Chaparral Pro";color:#060A2E">Natalie N. Kuehler</span><span style="font-size:11.0pt;color:#060A2E"><o:p></o:p></span></p>
<p class="MsoNormal" align="center" style="text-align:center"><span style="font-family:"Chaparral Pro";color:#060A2E">THE KUEHLER LAW FIRM PLLC</span><span style="font-size:11.0pt;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">PO Box 3059 – 1112 State Route 20</span><span style="font-size:11.0pt;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">Winthrop, WA 98862</span><span style="font-size:11.0pt;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">o: (509) 996-2832 x1 – c (509) 557-5769<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"><a href="https://nam11.safelinks.protection.outlook.com/?url=http%3A%2F%2Fwww.kuehlerlaw.com%2F&data=05%7C01%7Cpjones%40duffykekel.com%7Ca47176f77fc74bdfdddc08da54a542f4%7C2d66ed5354fa4c2f8c4dbff1aca5479d%7C0%7C0%7C637915366025551564%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C2000%7C%7C%7C&sdata=W1%2BphC2Y9Qm8YDNoxDwTczaER5ILvk9Q8te211et%2FIQ%3D&reserved=0">www.kuehlerlaw.com</a></span><span style="font-size:11.0pt;color:#060A2E"><o:p></o:p></span></p>
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