bypass trust

Definition of "bypass trust"
  1. A type of trust established by couples that aims to minimize federal estate tax following the death of the second spouse by dividing the initial trust into two upon the death of the first spouse
How to use "bypass trust" in a sentence
  1. The couple set up a bypass trust to continue their wealth preservation strategy for their children.
  2. To prevent their estate from being heavily taxed, they created a bypass trust.
  3. In financial planning, a bypass trust can be an effective tool to avoid sizable estate taxes upon the death of the second spouse.

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