Question

Will jones has created a will that leaves everything to his wife except an exemption amount of $3 million. this exemption amount passes into a trust. what type of will has will created?

O exemption trust
O stated dollar amount
O living
O traditional marital share
O simple

Answer 1

Will Jones has established an exemption trust in his will, which allows a specified exemption amount of $3 million to be placed in a trust, thereby taking advantage of estate tax exemptions.

Step-by-step explanation:

Will Jones has created a will that includes an exemption trust, also commonly referred to as a bypass trust or credit shelter trust. This type of trust allows Will to leave an exemption amount of $3 million separate from what he leaves to his wife, effectively taking advantage of the estate tax exemption. The trust holds the exemption amount and can benefit the surviving spouse, while ultimately passing to other beneficiaries without being subject to estate taxes. As of 2013, the estate tax exemption was $5.25 million, increasing to $5.43 million in 2015, according to the Center on Budget and Policy Priorities. Such exemption figures indicate that the estate tax typically affects only a tiny percentage of those with high levels of wealth.