You will recall that under the uniform basis rule that the tax law utilizes, the trust's basis in its assets is allocated between the income beneficiary and the remainderman
according to their actuarial interests, which change each year as the life expectancy of the life income beneficiary declines.
Charitable organizations are sometimes willing to serve as trustee of a CRT if they are designated as the sole or majority charitable remainderman
This duty to act fairly confers a wide discretion upon trustees(35) enabling them to act partially but honestly(36) by favoring an elderly penurious life tenant needing income at the expense of a wealthy remainderman
, especially where the life tenant was close to the testator or settlor and the remainderman
is a more remote relative or a charity.
However, a retained interest which is not a right to receive a fixed amount or a fixed percentage of the fair market value of the property in trust at least annually is disregarded, but only if the remainderman
is a "member of the transferor's family.
To avoid this unexpected gift from the income beneficiary to the remainderman
, the Crumrney power may be limited to a level that does not exceed the allowable lapsing right gift tax exemption (i.
The capital of the trust belonged to the remainderman
even when the specific assets making up the original capital were replaced by other assets.
TABLE 1 GRANTOR RETAINED ANNUITY TRUST Payment Remainderman
Calculations Type of Trust: Term Annuity Payment Rate: 14.
1972) (contingent remainderman
who sued alone obtained a damage award, which was impounded to await vesting).
In addition, a trustee is ineligible to elect the new adjustment statute if the trustee is a current beneficiary or presumptive remainderman
, or if the trustee would benefit directly or indirectly (although not a current beneficiary or a presumptive remainderman
The land was held in an unusual remainderman
interest, where in order to maximize the tax shelter benefits in the building, the land was held as an estate for years by the Integrated partnership formed by Integrated Resources.
Under the actuarial method of allocation, the investment company is not an FPHC if the investment company earns $2 million of income, since the majority of the stock would be attributed to the NRA remainderman
21] The right to the income is not a present interest even if B is also the remainderman
entitled to the property on the termination of the trust.