American College Exam HS330 Topic 1 Question 69 Discussion

Actual exam question for American College's HS330 exam

Question #: 69
Topic #: 1

[All HS330 Questions]

All the following statements concerning a grantor-retained unitrust (GRUT) are correct EXCEPT:

AThe transfer of the remainder interest in the trust is a current gift for gift tax purposes.

BWhen the trust is created, the grantor makes an irrevocable transfer to remainder person(s).

CThe grantor's applicable credit amount may be applied to the gifted remainder interest in the trust.

DWhen the grantor dies during the retained interest term, the estate tax benefits are increased.

Show Suggested Answer

Suggested Answer: A

by Helaine at Apr 26, 2023, 03:51 AM

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Nada

26 days ago

Wait, is this a trick question? I feel like the answer has to be D, but I'm second-guessing myself now. Hmm, maybe I should have studied harder for this exam.

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Dante

8 days ago

A) The transfer of the remainder interest in the trust is a current gift for gift tax purposes.

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Lauryn

1 months ago

D has got to be the right answer. The estate tax benefits wouldn't increase just because the grantor passed away during the retained interest term. Seems pretty straightforward to me.

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Mauricio

15 days ago

C) The grantor's applicable credit amount may be applied to the gifted remainder interest in the trust.

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Jin

18 days ago

B) When the trust is created, the grantor makes an irrevocable transfer to remainder person(s).

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Mila

20 days ago

A) The transfer of the remainder interest in the trust is a current gift for gift tax purposes.

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Kaitlyn

1 months ago

Haha, this question is a real head-scratcher! I'd have to say the answer is D. Can't imagine the estate tax benefits would go up if the grantor kicks the bucket early.

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Rebecka

1 months ago

Hmm, I'm a little unsure about this one. Let me think it through... Ah, I got it! The answer must be D. The estate tax benefits are not increased in that scenario.

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