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trustee. At that time, she also created the Melvine B. Atkinson
Irrevocable Trust (administrative trust) and placed stock worth
$953,012 in that trust. MacQuarrie was named trustee for this
second trust as well. On the same day, decedent signed her Last
Will and Testament (will), naming MacQuarrie as personal
representative.
The annuity trust provided that the trust would pay decedent
an annuity equal to 5 percent of the fair market value of the
assets of the trust as of the date of its creation, in equal
quarterly payments, until her death. At least seven quarterly
payments of $49,999.68 ($3,999,974 x 5% � 4), totaling
$349,997.76, should have been made to decedent before her death.
No payments were actually made from the trust account during
decedent’s lifetime. The value of the trust was not diminished
by the 5-percent payments. MacQuarrie was aware that the trust
document and the statutes relating to CRAT’s required that a
minimum of 5 percent of the initial fair market value be paid out
each year, and he was aware that decedent was not withdrawing
money from the trust. No funds were ever transferred to decedent
from the trust. The amount of $366,334.92, representing the
amount due to decedent under the trust terms, was included as an
asset of decedent’s estate.
Upon decedent’s death, the trust document provided that the
same 5-percent annuity amount was to be distributed amongst
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Last modified: May 25, 2011