Christian transferred $60,000 to an irrevocable trust for the benefit of his three daughters. The three daughters share income equally for five years and then the corpus of the trust is to be divided equally between them. What is the amount of the taxable gifts, if any, made by Christian?

Question

Quizplus · Accepted Answer

The annual exclusion applies only to gifts of present interests (the income interest), and a gift of a future interest (e.g. a remainder) is not eligible for an annual exclusion. The income interest must be valued to be certain that the present interest is large enough to sustain the annual exclusion.

Christian Transferred $60,000 to an Irrevocable Trust for the Benefit