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In Private Letter Ruling 201707008 (released Feb. 17, 2017), the Internal Revenue Service ruled that a wife wouldn’t recognize gain or loss from her husband’s transfer of property to a trust for her benefit under a proposed divorce settlement agreement. Moreover, except for any unexercised withdrawal right that the wife may hold at her death, the trust assets wouldn’t be included in her gross estate.

Source: Trust Assets Pursuant to Divorce Settlement Agreement

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