What is the difference between a testamentary trust and an inter vivos trust? Multiple Choice A testamentary trust is created by a will; an inter vivos trust is created by a living individual. A testamentary trust conveys money to a charity; an inter vivos trust conveys money to individuals. A testamentary trust ceases after a specified period of time; an inter vivos trust is assumed to be permanent. A testamentary trust conveys income to one party and the principal to another; an inter vivos trust conveys all monies to the same party.

What is the difference between a testamentary trust and an inter vivos trust? Multiple Choice A testamentary trust is created by a will; an inter vivos trust is created by a living individual. A testamentary trust conveys money to a charity; an inter vivos trust conveys money to individuals. A testamentary trust ceases after a specified period of time; an inter vivos trust is assumed to be permanent. A testamentary trust conveys income to one party and the principal to another; an inter vivos trust conveys all monies to the same party.

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter28: Income Taxati On Of Trusts And Estates

Section: Chapter Questions

Problem 23P

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What is the difference between a testamentary trust and an inter vivos trust. A testamentary trust conveys money to a charity; an inter vivos trust conveys money to individuals. A testamentary trust is created by a will; an inter vivos trust is created by a living individual. A testamentary trust conveys income to one party and the principal to another; an inter vivos trust conveys all monies to the same party. A testamentary trust ceases after a specified period of time; an inter vivos trust is assumed to be permanent.
What is the difference between a testamentary trust and an inter vivos trust? Choose the correct.a. A testamentary trust conveys money to a charity; an inter vivos trust conveys money to individuals.b. A testamentary trust is created by a will; an inter vivos trust is created by a living individual. c. A testamentary trust conveys income to one party and the principal to another; an inter vivos trust conveys all monies to the same party. d. A testamentary trust ceases after a specified period of time; an inter vivos trust is assumed to be permanent.
A charitable trust is used to split assets between surviving spouse and the trust. True or False
For the following definitions, indicate the type of trust being described by selecting the correct answer from the dropdown. option for answer - blind trust, life insurance trust, living (revocable) trust, divorce trust, trust for minors a. Holds life insurance policies on the insured. b. Provides funds for a college education or other needs, shifts income to other taxpayers, and transfers accumulated income without permanently parting with the underlying assets. c. Manages assets, reduces probate costs, provides privacy for asset disposition, protects against medical or other emergencies. d. Manages the assets of an ex-spouse.
a. What is the difference between distributing property per capita and per stirpes? When would a per stirpes distribution be required? what are two ways in which the duties of an administrator differ from those of an executor? Must the grantor, trustee, and beneficiary of a trust all be different people? What formalities must be followed to create a testamentary trust?
Which one of the following statements best describes the most important feature of a support trust? A) Trust assets must revert to the grantor. B) It is created by the terms of a will and therefore does not become effective until death. C) It provides for the trustee to take over management of the grantor's assets only upon the occurrence or nonoccurrence of certain specified events. D) It provides that the trustee shall distribute only so much of the income or principal as the trustee deems necessary for the support of a named beneficiary.
Under a deferred annuity owned by a nongrantor trust, how does the annuity's death benefit operate?(Search Chapter 6) a. The death of the trust grantor triggers payout of the contract's death benefit and termination of the contract. b. The death of the primary annuitant triggers payout of the contract's death benefit and termination of the contract. c. The death of the trust beneficiary triggers payout of the contract's death benefit and termination of the contract. d. Annuities owned by a trust can continue in perpetuity; since trusts do not die, there is no death benefit payable from an annuity owned by a trust.
In estate planning, setting ul a trust account in the name of beneficiaries may help to _______ a. Improve the faith of the beneficiaries b. Maximise the estate tax obligation c. Protect the beneficiaries against future inflation d. Protect the beneficiaries from the creditors of the donor
Which of the following is a charitable lead trust? Choose the correct.a. The income of the trust fund goes to an individual until death, at which time the principal is conveyed to a charitable organization.b. Charitable gifts are placed into the trust until a certain dollar amount is achieved and is then transferred to a specified charitable organization.c. The income of a trust fund goes to a charitable organization for a specified time with the principal then being conveyed to a different beneficiary.d. A charity conveys money to a trust that generates income for the charity’s use in its various projects.
How does a devise differ from a legacy? Choose the correct.a. A devise is a gift of money and a legacy is a nonmonetary gift.b. A devise is a gift to an individual and a legacy is a gift to a charity or other organization. c. A devise is a gift of real property and a legacy is a gift of personal property.d. A devise is a gift made prior to death and a legacy is a gift made at death.
Which of the following are nontax characteristics of a qualified terminable interest property (QTIP) trust? The income may go to multiple beneficiaries. The donor or decedent's executor qualifies the trust assets for the marital deduction by making a timely election The principal of the trust is paid to the surviving spouse's estate if the election to qualify the assets for the marital deduction was not made upon creation of the trust. The grantor of the trust determines who receives the remainder interest in the trust assets. A)II, III, and IV B)I and III C)IV only D)II and IV
Describe the usefulness of a discretionary intervivos trust when used as part of an estate freeze.