Estate of Merle Allen Whiting, Jr., Deceased, Vicki Ann Whiting, Executrix - Page 12

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          “terminable interest”.  Estate of Nicholson v. Commissioner,                
          supra at 671.  A “terminable interest”, generally, is a property            
          interest that will terminate or fail “on the lapse of time, on              
          the occurrence of an event or contingency, or on the failure of             
          an event or contingency to occur”.  Sec. 2056(b)(1).  An interest           
          in the nature of a life estate, therefore, is ineligible for the            
          marital deduction pursuant to section 2056(b)(5).  Estate of                
          Nicholson v. Commissioner, supra at 671-672.                                
               The Economic Recovery Tax Act of 1981 (ERTA), Pub. L. 97-34,           
          95 Stat. 172, modified the rules for the marital deduction                  
          relating to terminable interests.  ERTA sec. 403(d)(1), 95 Stat.            
          302, added section 2056(b)(7), which allows a marital deduction             
          for qualified terminable interest property (QTIP) interests.                
          Estate of Nicholson v. Commissioner, supra at 672.                          
               Section 2056(b)(7)(B) provides in pertinent part:                      
                    (7) Election with respect to life estate for surviving            
                              *   *   *   *   *   *   *                               
                    (B) * * * For purposes of this paragraph--                        
                         (i) In general.--The term “qualified                         
                    terminable interest property” means                               
                              (I) which passes from the decedent,                     
                              (II) in which the surviving spouse                      
                         has a qualifying income interest for                         
                         life, and                                                    
                              (III) to which an election under                        

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