Chapter 15: Trusts Flashcards
(8 cards)
Bare Trusts
Bare Trusts Outline the Following:
- Trustee Holds Legal Title
- Beneficiary Controls Direction of Trust Property
“Nominee Relationship”
Transparent for IT and IHT.
Interest in Possession Trusts
What is a Life Tenant?
A Beneficiary Entitled to to the Income or Use of Trust Assets for Life.
Not the Underlying Capital.
Interest in Possession Trusts
What is a Remainderman?
A Beneficiary Absolutely Entitled to Trust Property Following the LIfe Tenant’s Death.
The Capital Element
Interest in Possession Trusts
What is a Resulting Trust?
Where Ownership of Property Reverts Back to the Settlor.
Not Expressly Created by Written Agreement
The Case When There is No Explicit Remainderman.
Discretionary Trusts
What is an Exhaustive Discretionary Trust?
Where Trustees are Under Duty to Distribute All Income Arising in a Particular Period.
Discretionary Trusts
What is a Non-Exhaustive Discretionary Trust?
Where Trustees Have Discretion as to the Distribution of All Income Arising in a Certain Period.
Flexible Life Interest Trusts
Flexible Life Interest Trusts Could be Set up Due to:
- Protect Property for Future Generations
- Protect Family Wealth From Marriage Breakdowns or Bankruptcy
Flexible Life Interest Trusts
What is a Protective Trust?
A Trust Set up Following a Beneficiary’s Bankruptcy or Attempt to Dispose of Life Interest.
An Interest in Possession Trust Converts Into a Discretionary Trust.
