Bob Abelson, CPA

Torrance, CA

The purpose of the QDOT (Qualified DOmestic Trust) is to allow a marital deduction on Form 706 for a decedent with a noncitizen spouse. Normally the marital deduction just defers the decedent's estate tax until the death of the surviving spouse. If the marital deduction assets aren't going to be included in the spouse's gross estate no deduction is allowed.

Principal withdrawals from a QDOT are taxable as if they were added to the original decedent's estate - they are not part of the gross estate of the survivor. Any deductions attributable to those assets would have been shown on the original 706 or on Forms 1041.

Mary Kay Foss