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

What is redeemable debt, What is Redeemable debt Company will have to...

What is Redeemable debt Company will have to re-pay the debt at redemption date or between the two redemption dates (i.e. 20X5/20X9, means debt can be redeemed any time betwe

Cost of holding inventories, Q. Cost of Holding Inventories? The holdin...

Q. Cost of Holding Inventories? The holding of inventories engages blocking of a firm's funds. The various risks as well as costs in holding inventories are as below: (1) Ca

Define weight refer to in weighted average cost of capital, What does the “...

What does the “weight” refer to in the weighted average cost of capital? The weight considered to in weighted average cost of capital consider the portion of the total capital in

Explain the effect of foreigners’ portfolio investments, As the early 1980s...

As the early 1980s, foreign portfolio investors have purchased an important portion of U.S. treasury bond issues. Discuss the short-term and long-term influences of foreigners’ por

Cash discount, I am trying to solve this formula: 2/10, net 30. In the bo...

I am trying to solve this formula: 2/10, net 30. In the book I am reading they have 2% x 360 ------- ------ = 2.04% x 18=36.72% 100-2% (30-10) I want to know how the

Compounding technique for calculating time value of money, COMPOUNDING TECH...

COMPOUNDING TECHNIQUE is the method of calculating the future values of cash flows and involves calculating compound interest.  Under this process, interest is compounded when the

Define leverage, Q. Define leverage? Meaning of Leverage: - The diction...

Q. Define leverage? Meaning of Leverage: - The dictionary significance of the term leverage refers to 'an increased means of accomplishing some purpose'. For instance leverage

Tax-backed debt obligations, Tax-backed debt obligations are the debt...

Tax-backed debt obligations are the debt instruments issued by counties, states, cities, towns, special districts and school districts. These are secured by some

Financial and management accounting, the salaries paid in 2004 is rs 500000...

the salaries paid in 2004 is rs 500000 outstanding is rs 20000 salaries paid in advance for 2004 is rs 30000 what is the actual salary expenditure for 2004 which accounting princip

TRIAL BALANCE, #The following items are found in the The following items ar...

#The following items are found in the The following items are found in the trial balance of M/s Sharada Enterprise on 31st December, 2000.

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