Estate Planning: Marital Trust ("A" Trust) - T. Rowe Price

A marital trust (also called an "A" trust) is usually funded at your death with any amount in excess of a person's available federal estate tax exemption amount and would be eligible for the unlimited marital deduction.* To qualify for the marital deduction, only the surviving spouse can be the beneficiary of the trust and must have the right to receive income from the trust during his or her lifetime. (The surviving spouse does not necessarily have to take distributions of income unless required to do so by the terms of the trust.) Since the trust assets were not taxed at the first spouse's death, whatever remains in the trust at the death of the surviving spouse is subject to taxation in that spouse's estate.

With a general power of appointment, the surviving spouse can control the ultimate distribution of the trust assets. The surviving spouse is granted a general power of appointment to modify the way assets are distributed at his or her death, if your spouse so chooses.

A marital trust generally is used in combination with a bypass trust (also called a "B" trust).

You should also refer to the section on qualified terminable interest property (QTIP) trusts, which are used more frequently than marital trusts with a general power of appointment.

*If one spouse is not a U.S. citizen, different marital deduction rules apply. Consult an estate planning attorney or tax advisor for further details.