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Question;Per the text and IRC, a gift occurs when the transfer of property is complete;and the gift is valued at the date of the transfer. Imagine a scenario in which;a client creates an irrevocable trust for his two (2) grandchildren to ensure;college education expenses are paid. The trust agreement requires the;distribution of the income from the trust directly to the college or university;the grandchildren attend for tuition while they are in college and directly to;the grandchildren until age twenty-five (25) after completing college. The;income from the trust is distributed directly to the grandchildren until they;reach age twenty-five (25), if they do not attend college. When the;grandchildren celebrate their twenty-fifth (25th) birthday, the income stream;distribution reverts to the client?s spouse, and the spouse receives the;property upon the death of the client. Examine the gift tax consequences of the;transaction based on the use of the irrevocable trust, as compared to direct;payments to the grandchildren.;From the e-Activity and the scenario from Part 1 of this discussion, create;a tax strategy which ensures that gift tax is paid on the property prior to the;death of the client and that the client may use the full benefit of the;gift-splitting election.


Paper#42709 | Written in 18-Jul-2015

Price : $43