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Beatrice and Peter each received an interest in one-half of the
corpus and income of the trust, and each received a special power
to appoint the corpus of his or her one-half share of the trust
to his or her children or grandchildren.
Under the trust provisions, 16 contingent remainder
beneficiaries were designated. Beatrice’s three children and
eight grandchildren were designated as contingent remainder
beneficiaries in Beatrice’s one-half share of the trust, and
Peter’s spouse and four sons were designated as contingent
remainder beneficiaries in Peter’s one-half share of the trust.
Beatrice and Peter, as well as the 16 contingent
beneficiaries, were each given the right -- following each
transfer of property to the trust -- to demand from the trust an
immediate distribution to them of property in an amount not to
exceed the $10,000 annual gift tax exclusion under section
2503(b) that was considered to be available to each beneficiary.
Each beneficiary’s right to demand a distribution lapsed 30 days
after a transfer of property to the trust. The guardian of any
minor beneficiary was authorized to exercise the minor
beneficiary’s right to demand a distribution of property from the
trust.
On April 2, 1990, within 6 days of decedent’s transfer of
the commercial building to the trust, the beneficiaries of the
trust were timely notified of their rights to demand
distributions of trust property of up to $10,000 each. None of
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Last modified: May 25, 2011