On May 6, 2011, the IRS released Tax Correspondence, Doc 2011-11399, in response to an individual's request to the IRS to include in its 2011-2012 guidance priority list guidance to resolve the issues raised by marital deductions in a Qualified Terminable Interest Property (QTIP) trust which includes decedent's assets in an IRA. The IRS commented that there is a difference to the surviving spouse between inheriting an IRA and rolling it over or being the beneficiary of a QTIP marital trust. Specifically, undistributed gains would be taxable to the trust.
Hat Tip: Tax Analysts
Posted by Jessica Rebarber, Associate Editor, Wealth Strategies Journal
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