Terry Is Considering Transferring Assets Valued at $400,000 to an Irrevocable

question 5

Essay

Terry is considering transferring assets valued at $400,000 to an irrevocable trust for the benefit of her son, Cliff, age 15, with First National Bank as trustee. Her attorney has drafted a trust agreement that provides that Cliff is to receive income at the trustee's discretion for the next 20 years and that at age 35, the trust assets will be distributed equally between Cliff and his sister Joanna. Terry anticipates that her husband will consent to gift splitting. What tax issues should Terry and her husband consider with respect to the trust she is creating?

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Definitions:

Persuasive Strategies

Techniques employed to convince or influence others to adopt a particular viewpoint or action.

Dramatistic Analysis

A method in communication studies for examining motivations and actions within narratives by considering five elements: act, scene, agent, agency, and purpose.

Purpose

The reason for which something is done or created, or for which something exists.

Conversation Analysis

A methodological approach to studying the structure and pattern of conversations to understand how participants comprehend and respond to one another.