A-b trust, Financial Management

Assignment Help:

It is a trust developed by a married couple with the purpose of minimizing estate taxes. An A-B trust is a trust that splits into two on the death of the first spouse. It is produced with each spouse putting assets in the trust and naming as the final beneficiary to any appropriate person except the other spouse. The trust obtains its name from the fact that it divides into two upon the first spouse's death - trust A or the survivor's trust, and trust B or the decedent's trust.

The surviving spouse has total control over the survivor's trust, which holds his or her property interests, but has partial control over the assets in the deceased spouse's trust. Though, this restricted control over the assets in the decedent's trust will still allow the surviving spouse to reside in the couple's house and take income from the trust, given that these terms are fixed in the trust. On the casualty of the surviving spouse, the property in the decedent's trust transfers to the beneficiary(s) named in this trust. As this property is not considered part of the second spouse's estate for reasons of estate tax, double-taxation is ignored.

 

 


Related Discussions:- A-b trust

Optimal capital structure, (a) The calculation of the Weighted Average Cost...

(a) The calculation of the Weighted Average Cost of Capital (WACC) is theoretically easy but practically complex. Discuss. (b) Two-fifths of the total market value of Jefferson

Beta, what is the value of beta for this fund ? If the benchmark index for ...

what is the value of beta for this fund ? If the benchmark index for this mutual fund increased by 11.00% during the period covered by beta measure, what was the rate of return for

Determine the no-arbitrage price, 1.  Suppose Bank one offers a risk free i...

1.  Suppose Bank one offers a risk free interest rate of 5.5% on both savings and loans, and Bank Enn offers a risk free interest rate of 6% on both savings and loans. What arbitra

A company has total debt , A company has total debt of $1,200 and a debt-eq...

A company has total debt of $1,200 and a debt-equity ratio of 0.5. What will be  the value of the total assets?

Financial planning assignment, School of Business BUACC1521 Personal Financ...

School of Business BUACC1521 Personal Financial Planning ASSIGNMENT 1. General information As detailed in the Course Description, the assignment constitutes 30% of the tota

Explain the features of new public management, Question 1: "The governa...

Question 1: "The governance of modern states demands that a relentless struggle be waged against the scourge of corruption." Discuss. Question 2: Explain clearly how th

Rejecting proposed projects when using internal rate of retu, What is the d...

What is the decision rule for accepting or rejecting proposed projects when using internal rate of return? Whenever the internal rate of return is equal or greater than to the

Cost of Capital, The Nu-Nu Brothers Inc. (NNBI) has the following capital s...

The Nu-Nu Brothers Inc. (NNBI) has the following capital structure, which it considers to be optional: Debt 25% Preferred Stock 15% Common Equity 60% NNBI''s expected net income t

Explain intuition behind the npv capital budgeting framework, What is the i...

What is the intuition behind the NPV capital budgeting framework? The NPV framework is a discounted cash flow method. The method compares the present value of all cash inflows

Credit rating, As the number of companies borrowing directly from the...

As the number of companies borrowing directly from the capital market increases, and as the industrial environment becomes more and more competitive and demanding,

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd