According to the Terminal Interest Rule, what must occur for property to be qualified?

The Terminal Interest Rule pertains to the treatment of property interests in the context of estate planning, particularly when considering the eligibility for certain tax benefits. Under this rule, for property to be qualified, it is essential that the spouse survives the conditions set forth in the estate plan. This means that the surviving spouse must have a continued interest in the property for it to be included in the marital deduction, which allows the property to pass to the surviving spouse without incurring estate taxes at the time of transfer.

The reasoning behind this is rooted in the requirement that the transfer of property to a surviving spouse must be certain and not subject to potential loss due to conditions that could cause the property to revert back to the decedent's estate. As such, the survival of the spouse ensures that the property remains a transferable interest, thus qualifying for the tax benefits intended under the rule.

The other options, while relevant to property and estate planning, do not address the specific requirement set by the Terminal Interest Rule for property to qualify in the context of taxation and marital benefits.