Because the values of a married couple’s estate and the amount of the estate tax exemption change over time, estate planners commonly use formulas in a will or trust to avoid inadvertently triggering an estate tax on the first spouse’s death. These formulas divide a deceased person’s assets between a marital share which qualifies for the unlimited marital deduction and a non-marital share which uses the deceased spouse’s estate tax exclusion amount to pass the decedent’s assets estate tax free.
There are three types of formulas: a Pecuniary Marital, a Fractional Share and a Pecuniary Credit. Each formula has its