EP CHAP8 Flashcards
What is a trust ?
Vehicle that owns assets
Who is the grantor ?
The creator of the trust
Who is the trustee ?
A person or firm that holds or administers property or assets for the benefit of a third party
Who is a beneficiary ?
Person receiving assets
What are fiduciary duties ?
Protect the beneficiary
What are reasons to use a trust ?
Management, creditor protection, avoiding probate, minimizing taxes
What is trust duration ?
Until document says it ends
What is a revocable trust ?
A trust whereby provisions can be altered or canceled dependent on the grantor
What is a irrevocable trust ?
Cannot be taken away
What is a living trust ?
Avoids probate process ; determine des position of property
What is a testamentary trust ?
Does not go into action until death of grantor
What is a standby trust ?
credit shelter
What is a Bypass(credit shelter) trust ?
used to pass down assets after death without subjecting them to the estate tax
It is irrevocable
What is the QTIP trust ?
Property that transfer for benefit of surviving spouse ( part of marital deduction )
Dynasty Trust ?
Long-term trusts created to pass wealth from generation to generation without incurring transfer taxes such as estate and gift tax.
