Which of the Following Is Not a Characteristic of a Crummey

question 25

Multiple Choice

Which of the following is not a characteristic of a Crummey trust?

• A)A Crummey trust is a grantor trust, with the result that all trust income will be taxed to the grantor.
• B)A Crummey trust allows the grantor to delay distribution of trust assets beyond the 21st birthday of the trust beneficiary.
• C)Transfers into a Crummey trust are eligible for the annual gift tax exclusion because of the withdrawal right given to trust beneficiaries.
• D)Beneficiaries of a Crummey trust must be notified of their withdrawal right within a reasonable period prior to the lapse of the right.

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Definitions:

Current Value

The present worth of an asset or company, considering its financial standing, market condition, and other factors influencing its valuation at the current time.

Long-term Future

A period of time that extends beyond the immediate future, focusing on developing strategies or goals that will have an impact in the coming years.

Tangible Assets

Physical items of value owned by a business, such as buildings, machinery, or inventory.

Balance Sheet Method

An accounting technique used to estimate the liquidity of a company by analyzing its assets, liabilities, and shareholders' equity at a given point in time.