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19 Cards in this Set
- Front
- Back
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Inter Vivos Trust
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A transfer that occurs during the transferor's life time...meaning among the livng
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Grantor or Trustor
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The transferor
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Testamentory Trust
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A trust created under the direction of a decedents will and certains assets formerly held by the decedents estate
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Estates are taxed like?
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A complex trust
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2 Beneficiaries
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1. Income
2. Remainderman |
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Fiduciary Tax Rate
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Top Rate of 35% for income levels above $10,000, makes income tax reduction impossible
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What must happen for the transferor to exclude the property conveyed to the trust from the gross estate?
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The transferor must not retain the right to receive the trust income or the power to control which other people receive income or have, at the time of death, the power to alter the identity of anyone named earlier to receive such assets.
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Why do individuals use trusts?
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Because minors are the donees so that a trustee can manage the assets.
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Revocable Trust
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A trust in which the grantor may demand that the assets be returned. Doesn't yield any income or estate tax savings for the grantor.
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3 Conditions for Simple Trust
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1. All income is distributed currently and annually
2. No charitable mandate, beneficiary 3. No corpus is distributed |
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Where does everything in a revocable trust go?
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1040
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Can you go from a simple trust to a complex trust?
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Yes
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Do trusts have itemized deductions?
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No
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How much money do you need to set up a trust?
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$100 and can make life time transfers
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Difference between Wills and Trusts?
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Wills are public knowledge, trusts aren't
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Income Receipts
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The return in money or property derived from the use of principal.
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Examples of Income Receipts
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1. Rent
2. Interest 3. Dividends Received 4. Investment Income 5. Net Business Profits |
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Estate Exemption Amount
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$600
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Trust Exemption Amount
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If trust instrument requires that trustee distribute all income annualy, then $300. Other wise $100
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