Understanding the Concept of Grantor in Trusts
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According to the Treasury Regulation, who is considered the grantor of a trust?

  • The beneficiary who will receive distributions from the trust
  • Only the person who initially established and funded the trust
  • Any person who creates the trust or makes a gratuitous transfer of property to the trust (correct)
  • The trustee or administrator appointed to manage the trust assets

    • In the case of a trust created with assets of a legally incapacitated person, who is considered the grantor?

  • The trustee appointed to manage the trust assets
  • The legally incapacitated person themselves (correct)
  • The person who initiated the legal proceedings
  • The court-appointed guardian or conservator

    • If a person exercises a general power of appointment over a trust in favor of a second trust, who is treated as the grantor of the second trust?

  • The person who exercised the power of appointment (correct)
  • The trustee of the second trust
  • The beneficiary of the second trust
  • The grantor of the original trust

    • In community property states, who is typically considered the grantor of a dual grantor trust?

    <p>Both spouses are considered grantors</p> Signup and view all the answers

    What happens when the grantor of a trust makes a gratuitous transfer to a second trust?

    <p>The grantor is considered the grantor of both trusts</p> Signup and view all the answers

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