Identify which of the following statements is false.
A)If an individual transfers property in trust and reserves the right to the trust's income for life, the individual retains a life estate.
B)An individual who receives a remainder interest will receive property after the death of the holder of a life estate.
C)If a grantor transfers property in trust and names a beneficiary to receive only a term-certain interest and then the property is to return to the grantor, the transaction is not subject to gift tax.
D)Life estates are valued using actuarial tables.

Question

Quizplus · Accepted Answer

This statement is false. If a grantor transfers property in trust and names a beneficiary to receive only a term-certain interest and then the property is to return to the grantor, the transaction is subject to gift tax. The grantor has made a gift of the term-certain interest to the beneficiary, and the return of the property to the grantor is not considered a retained interest.

Identify Which of the Following Statements Is False