Dolch

BACKGROUND

A. The Trust and Its Terms Frank died testate in 1984. In his will, Frank left his Hillsborough home, all of his personal property, and $500,000 in cash for his wife, Thea. Frank established the Trust under his will. The Trust was structured to take advantage of the marital tax deduction and estate tax exemptions (Marital Trust), with the residue of Frank’s estate held in a separate trust (Residuary Trust). During her lifetime, Thea was the sole beneficiary of the Marital Trust and the Residuary Trust. As to the administration of the Marital Trust, paragraph 2.B.i of the Trust provides: “All net income shall be paid to THEA B. BACON, the decedent’s wife, at monthly or other convenient intervals, but at least annually.” Paragraph 2.B.ii provides: “From time to time and at any time, the Trustee may pay to the decedent’s wife so much of the principal of the Marital Trust as is necessary or advisable, in reasonable discretion, for her support, health and maintenance, in accordance with her customary standard of living.”4 Additionally, paragraph 2.B.iii provides: “Upon the death of

4Trust distributions made for a beneficiary’s support, health, and maintenance are…