Discuss American College HS330 Exam Topic 1 Question 9

All the following statements concerning a grantor-retained annuity trust (GRAT) or a grantorretained unitrust (GRUT) are correct EXCEPT:

AAfter the initial transfer to a GRAT, the grantor is prohibited from making additional contributions to the trust.

BFor gift tax purposes a grantor's retained interest in these trusts is valued at zero.

CPost-transfer appreciation of property transferred to these trusts is excluded from the grantor's gross estate.

DA grantor receives an annual payout from a GRUT that is based on the value that the trust grows or contracts to each year.

Suggested Answer: B

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12 comments · newest first

Joni 11 months ago

I thought GRUT payouts were fixed, not based on trust value.

Trinidad 12 months ago

Post-transfer appreciation is definitely excluded, that's correct.

Amos 12 months ago

Wait, is it really zero for gift tax purposes? Sounds off.

Paulene 12 months ago

Totally agree, that's a key point!

Alease 1 year ago

A GRAT doesn't allow extra contributions after the initial transfer.

Christa 1 year ago

I'm pretty confident I know the answer to this one. ICMP is the only option that is considered management traffic, not protocol traffic.

Georgene 1 year ago

Okay, I think I've got this. If net retention is lower, that means there's more uncertainty and volatility in the reserves, so the variability would be higher. I'm going with True on this one.

Bernadine 1 year ago

This seems like a pretty straightforward Agile question. I'm confident I can tackle this one.

Lasandra 1 year ago

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Mable 1 year ago

This seems like a straightforward question, I'll carefully read through the options and select the two that best match the operation entries for face search.

Leeann 1 year ago

Okay, I remember learning about this in class. The ON DELETE CASCADE constraint means that if you delete a parent record, any child records that reference that parent will also be automatically deleted.

Dorthy 1 year ago

I think we set up a filter that uses the Forged Email Detection rule, but I can't recall if we also had to enable it on the Security Services page.

American College HS330 Exam - Topic 1 Question 9 Discussion