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

Explain the compound interest, What is compound interest? Compare compound ...

What is compound interest? Compare compound interest to discounting. Compound interest takes place while interest is earned on interest and on the original principal of an invest

What was the value of each person investment, Joe and Sam each invested $20...

Joe and Sam each invested $20,000 in the stock market. Joe's investment increased in value by 5% per year for 10 years. Sam's investment decreased in value by 5% for 5 years and th

Traditional approach of financial management, Q. Traditional Approach of Fi...

Q. Traditional Approach of Financial Management? Traditional Approach: - Under this schema the role of financial management was limited to the procurement of funds on suitable

Net income, What remains of an organization revenue after all expenses and ...

What remains of an organization revenue after all expenses and taxes have been paid.

Organizational structure of pension funds, Organizational Structure of pens...

Organizational Structure of pension funds In an investment organization such as pension funds, endowments, life and casualty insurance companies, the central bank's investment

Role of the public expenditure management system, Question : (a) The ro...

Question : (a) The role of the Public Expenditure Management System (PEMS) is to allocate and use resources responsively, efficiently and effectively'. Briefly explain the abo

Leverage, what is the meaning of market feasibility? What are its different...

what is the meaning of market feasibility? What are its different types with their degree?

Standard & poor’s analyze in determining the credit rating, What factors do...

What factors does Standard & Poor’s analyze in determining the credit rating it assigns a sovereign government? Answer: In rating a sovereign government, Standard & Poor’s anal

Operating cycle, discuss the applicability of operating cycle in poultry in...

discuss the applicability of operating cycle in poultry industry

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