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1995), revg. T.C. Memo. 1992-579; Estate of Robertson v.
Commissioner, 15 F.3d 779 (8th Cir. 1994), revg. 98 T.C.
678 (1992); and Estate of Clayton v. Commissioner, 976 F.2d
1486 (5th Cir. 1992), revg. 97 T.C. 327 (1991).
The facts of each of the cases relied upon by
petitioner, Estate of Spencer, Estate of Robertson, and
Estate of Clayton, are similar. The estate plan of the
decedent in each of those cases included one or more trusts
in which the surviving spouse was given a qualifying income
interest for life, as defined by section
2056(b)(7)(B)(ii)(I), and at least one other trust in which
the surviving spouse was not given a qualifying income
interest for life. The decedent in each of the cases had
clearly articulated his intention that some or all of the
residue of his estate would pass to the “QTIP trust”. The
controversy arose because each decedent had also given his
personal representative the discretion to determine what
portion, if any, of the residue of his estate should pass
to the “QTIP trust”, and what portion should pass to the
non-QTIP trust. The Commissioner argued that the personal
representative’s discretion to direct property away from
the “QTIP trust” constituted an impermissible power to
appoint property away from the surviving spouse, contrary
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