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the grantor should revoke the spouse’s designation as the
successor annuitant, then the terms of the trust agreement are to
be applied as if the spouse had predeceased the grantor.
The 1995 GRAT’s
Each of the 1995 GRAT’s provides for annual payments,
referred to as the Annuity Amount, to be paid to the grantor
during the Annuity Term. The Annuity Term for Mr. Cook’s 1995
GRAT is 3 years, and the Annuity Term for Mrs. Cook’s 1995 GRAT
is 5 years. In the case of Mr. Cook’s 1995 GRAT, the Annuity
Amount is the fair market value of the initial assets of such
trust as of the date of transfer, as finally determined for
Federal tax purposes, multiplied by .3175, .3810, and .4572, for
year 1 through year 3, respectively. In the case of Mrs. Cook’s
1995 GRAT, the Annuity Amount is the fair market value of the
initial assets of such trust as of the date of transfer, as
finally determined for Federal tax purposes, multiplied by
.168940, .202728, .2432736, .2919283, and .3503139, for year 1
through year 5, respectively.
Each of the 1995 GRAT’s provides that during the Annuity
Term of the trust no distribution of trust income or principal
may be made to any person other than the grantor.
If the grantor of each 1995 GRAT survives the Annuity Term,
then any remaining trust property, after payment of the Annuity
Amount, shall be used to establish a separate trust for the
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Last modified: May 25, 2011