Which of the following is NOT required in a QTIP trust?

• A. All net accounting income to be paid to the surviving spouse at least annually.
• B. Principal to be distributed at the trustee's discretion for the surviving spouse's health education support or maintenance.
• C. The surviving spouse has the ability to require the trustee to convert non-income producing assets to income productive assets.
• D. The surviving spouse may be the only permissible distributee during their lifetime.

Answer: (C)

In a QTIP trust, the goal is to provide the surviving spouse with an income interest while preserving the decedent’s ability to control who will receive the assets after the spouse’s death. The essential features are that all net income from the trust goes to the surviving spouse at least annually, and the trustee can distribute principal for the surviving spouse’s health, education, maintenance, or support. During the spouse’s lifetime, the surviving spouse is typically the only permissible distributee, which helps ensure the income benefit remains with the spouse. The ability for the surviving spouse to compel the trustee to convert non-income producing assets into income producing assets is not a required element of a QTIP trust; the trust can qualify without that power, as long as the income and discretionary principal provisions are in place.