Probate & Trust Law Section Conference Manual ... - Minnesota CLE

5.8 Reverse QTIP Election. The Trustee may make the special election under Internal Revenue Code
Section 2652(a)(3) to treat all of the property of a Trust created under this Trust for which the QTIP
election is made as if that election had not been made, making me the transferor of the property for
purposes of the generation-skipping transfer tax. I desire that the Trustee set apart the property to
which the election has been made as a separate Trust, so that the inclusion ratio of the separate
qualified Trust, as defined in the Internal Revenue Code, is zero.
5.9 Payment Of Death Taxes. Upon my Spouse’s death, if my Spouse’s Will or Revocable Trust
directs that no estate taxes occasioned by my Spouse’s death that are paid from this Trust shall be
recovered by my Spouse’s estate from any person under Internal Revenue Code section 2207A or
otherwise, and if, or to the extent that my Spouse does not otherwise direct in my Spouse’s Will or
Revocable Trust, the Trustee shall pay from the remaining Trust principal that portion of the estate
taxes occasioned by my Spouse’s death equal to the excess of (a) the total of all such taxes so
payable, over (b) the total of all such taxes that would have been so payable if the assets of this Trust
had not been taxable in my Spouse’s estate. Such taxes shall not be apportioned to or recovered from
any person. The Trustee shall pay expenses incurred in determining and paying such taxes.
5.10 Spouse’s Power Of Appointment. Any remaining assets of the Marital Trust shall be distributed
in accordance with the exercise by my Spouse of a power of appointment that I hereby give to my
Spouse to appoint outright or in further Trust to any one or more of my descendants, their Spouses
and charities qualified under Internal Revenue Code Section 2055 who survive my Spouse.
My Spouse may not exercise this power of appointment to appoint Trust property to my Spouse, my
Spouse’s estate, my Spouse’s creditors, or the creditors of my Spouse’s estate.
My Spouse may exercise this power of appointment to grant in Trust further powers of appointment
to any person to whom principal may be appointed, but my Spouse may grant a presently exercisable
general power of appointment only in an exercise that makes specific reference to the Delaware Tax
Trap, or Internal Revenue Code Section 2041(a)(3) or 2514(d) i .
Any unappointed principal shall be distributed as provided in Article Seven, as if I died immediately
before my Spouse.
[Other Provisions To Revise If Delaware Tax Trap Provision Is Included]
_._ Special Power of Appointment. Any special power of appointment may be exercised by
appointment, outright or in Trust, in favor of one or more of the permissible appointees [or their
estates] in such portions as the donee of the power may appoint; provided, the power (a) shall not be
exercisable in favor of the donee, the donee’s estate, the donee’s creditors or the creditors of the
donee’s estate, and (b) shall not, unless the exercise makes specific reference to the Delaware Tax
Trap, or Internal Revenue Code Sections 2041(a)(3) and 2514(d), include the power to create another
power of appointment that, under the applicable local law, can be exercised so as to postpone the
vesting of any estate or interest in the Trust property or suspend the absolute ownership or power of
alienation of such Trust property for a period ascertainable without regard to the date of creation of
this power.
_._ Rule Against Perpetuities. Except with respect to an exercise that specifically refers to Internal
Revenue Code Section 2014(a)(3) or the “Delaware Tax Trap,” but notwithstanding any contrary
provisions, each Trust, if not sooner terminated pursuant to other provisions, shall terminate twentyone
(21) years after the death of the survivor of my Spouse and all my descendants who are living on
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