Patricia A. Schott - Page 14

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          charitable remainder trusts.  Petitioners rely on the legislative           
          history of section 2702, which states that qualified interests              
          under section 2702 “are similar to those permitted in charitable            
          split interest trusts under section 664."  136 Cong. Rec. S15629,           
          S15682 n.30 (daily ed. Oct. 18, 1990) (Explanatory Material                 
          Concerning Committee on Finance 1990 Reconciliation Submission              
          Pursuant to House Concurrent Resolution 310).                               
               Section 664(d) defines a charitable remainder annuity trust            
          as follows:                                                                 
                    (d) Definitions.--                                                
                         (1) Charitable remainder annuity trust.--For                 
                    purposes of this section, a charitable remainder                  
                    annuity trust is a trust--                                        
                              (A) from which a sum certain (which is                  
                         not less than 5 percent of the initial net                   
                         fair market value of all property placed in                  
                         trust) is to be paid, not less often than                    
                         annually, to one or more persons (at least                   
                         one of which is not an organization described                
                         in section 170(c) and, in the case of                        
                         individuals, only to an individual who is                    
                         living at the time of the creation of the                    
                         trust) for a term of years (not in excess of                 
                         20 years) or for the life or lives of such                   
                         individual or individuals * * *.  [Emphasis                  
               If Congress intended to include dual-life annuities in the             
          definition of a qualified interest for valuing the remainder                
          interests of GRAT’s, Congress could have included similar “life             
          or lives” language in section 2702.  Instead, section 2702 is               
          silent as to what constitutes an acceptable term for a qualified            

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