With the release of Trust Plus® version 19.1, Cowles now offers estate tax planning options for decoupled states. Recognizing that a growing number of jurisdictions have death taxes independent of the federal estate tax and that this trend is likely to continue, we have divided the tax planning options into state and federal planning, and have added three new state options, together with two previously existing options.

Phrase 270 is used to design plans for clients in states without a state death tax for which the value of the combined gross estates of both spouses is above the federal exclusion amount. It may also be appropriate in some situations for clients in states that have a state death tax, if they have determined that it is more advantageous to maximize their federal exclusion amount and pay some state death tax upon the death of the first spouse to die.

Phrase 275 is used to design plans for clients in decoupled states for which the value of the combined gross estates of both spouses is above the state death tax exclusion amount. It is particularly appropriate for estates where the amount transferred to the marital share, plus probable growth, will likely be less than the federal exclusion amount available to the surviving spouse at that spouse's death, and for those who believe that federal estate tax will no longer exist as of the date of the second spouse's death.

Phrase 275 includes the following options:

• Standard disclaimer option (previously existing)
• Option to fund marital and non-marital shares to the state exemption amount (previously existing)
• Three-trust option with a federal QTIP, state "gap" QTIP, and a non-marital share
• Partial QTIP (divided into qualifying and non-qualifying trusts)
• Clayton trust

Anticipating that more states will be enacting independent death taxes and that even those clients in states without a death tax may own property in states with a death tax, we have made these new options available to all users within the Phrase/Document area of the system.

Substantive Legal Help is available for all new phrase options including links for citations and other resources where appropriate. In addition a new checklist addendum is available from Members Only for these new options, allowing you to either easily utilize these options during the client appointment or disregard them if they do not apply.

These new phrase options are included with Cowles version 19.1, released in October, 2009 to all Cowles software users. If you have not downloaded the update, please visit Members Only/InstantUpdate for more information on other enhancements and a link to download the release. If you have questions or need installation assistance, please call us at (800) 366-1730, or email us at west.appsupport@thomson.com.

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