In a QTIP marital deduction trust, the surviving spouse MUST have:

In a QTIP (Qualified Terminal Interest Property) marital deduction trust, the requirement that the surviving spouse must be the only beneficiary of annual income during their lifetime is essential for the tax benefits associated with the trust.

The primary purpose of a QTIP trust is to allow the surviving spouse to receive income from the trust assets during their lifetime while deferring estate taxes until their death. By ensuring that the surviving spouse is the sole beneficiary of the trust's income, the trust meets the criteria for the marital deduction under the Internal Revenue Code. This arrangement allows the income generated by the trust to be excluded from the decedent's gross estate and therefore not subject to estate tax at the time of the first spouse's death.

If there were other beneficiaries receiving income from the trust concurrently, it could jeopardize the ability to claim the marital deduction, as it wouldn't meet the exclusive benefit requirement for the surviving spouse. Hence, this feature is a critical aspect of QTIP trusts to ensure tax efficiency and compliance with regulatory guidelines.