Question ID: $1252011$

Your client, age $65,$ has a gross estate valued at $$18\mathrm{.}7$ million. He and his second wife have two teenage children. In addition, your client has two children from his first marriage who are in their mid$-30$s$.$

His objectives are to:

leave an income stream and a portion of his estate to his current wife;

leave a portion of his estate in trust for the teenage children from his current marriage;

ensure that the children from his first marriage receive a portion of his estate; and

reduce his federal estate tax liability.

Which one of the following transfers is most appropriate for achieving the client's objectives?

A$)$

Outright transfer of the entire estate into a power of appointment trust

B$)$

Combination A$-$B$-$C $($power of appointment, family bypass, and QTIP$)$ trust arrangement

C$)$

Outright gift of two$-$thirds of the estate to his current wife, with the remainder passing to the teenage children in a nonmarital trust

D$)$

Family bypass trust equal to the applicable exclusion amount for the teenage children, with the remainder in a marital trust for his current wife