Chap 12

Question 0

Income beneficiary (trust beneficiary)

Answer 0

Receives income from the trust

Question 1

3 certainties to set up a trust

Answer 1

• Certainty of intent ( clear intention to creat trust)
• Certainty of subject matter ( what assets are being transferred)
• Certainty of object ( who is the beneficiary)

Question 2

Capital beneficiary ( trust beneficiary)

Answer 2

Receives capital from the trust

Question 3

Life interest ( trust beneficiary)

Answer 3

Right to use the asset for a specified time period. The beneficiary is a life tenant

Question 4

Reminder beneficiary

Answer 4

Capital interest that doesn’t come into effect until the person having life interest dies

Question 5

The 21 year rule (trust)

Answer 5

Except for spousal trust, trust must report a deemed disposition on the assets in the trust every 21years

Question 6

Charitable gift

Answer 6

A voluntary transfer of property to a registered charity for which the donor receives no benefit or a benefit of nominal value

Question 7

What is the maximum donation that can be deducted from income tax?

Answer 7

75% of income + 25% of recapture

and 100% on the year of death