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

Effective annual rate, You are interested in saving money for your first ho...

You are interested in saving money for your first house. Your plan is to make regular deposits into brokerage account which will earn 14%. Your first deposit of $5,000 will be made

Describe the merits and demerits of mutual funds, Question 1 Briefly expla...

Question 1 Briefly explain the important legislations that regulates the insurance sector Question 2 What do you mean by sales cycle? Briefly explain the different stages in

Total return for a mortgage-backed and asset-backed security, The ...

The total return in case of mortgage-backed and asset-backed securities depend on the projected principal repayment and the interest earned on r

Assessing creditworthiness of an issuer of bond, Following are the areas an...

Following are the areas an analyst should consider while assessing the creditworthiness of an issuer. 1. Security Limitations: The bond indenture shoul

Interest rates over the business cycle, Interest rates are the key de...

Interest rates are the key determinants of business cycles in emerging market countries. In the past, several economies had experienced frequent and great changes

Define the meaning of earn out arrangements, Earn out arrangements   C...

Earn out arrangements   Consideration could be delayed and paid only upon achievement of certain criteria. For illustration the predator company may pay additional cash if acq

Describe the general pattern of cash flows, Describe the general pattern of...

Describe the general pattern of cash flows from a bond with a positive coupon rate. Cash flows as of a bond with a positive coupon rate consist of periodic interest payments an

Exchange rates, Exchange Rates The prices at which one country's c...

Exchange Rates The prices at which one country's currency can be changed into that of other country. Although perceptions in the currency markets of the privacy of a count

Calculate the net present value of a purchase of earthmover, Your construct...

Your construction company is evaluating the proposed acquisition of a new earthmover. A consulting company you hired developed the following analysis last year at a cost to you of

Describe the balance of payments identity, Describe the balance of payments...

Describe the balance of payments identity and discuss its implications under the fixed and flexible exchange rate regimes. Answer:  The balance of payments recognize holds that t

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