D transferred property to T, as trustee, in trust, the income to be paid to X fo
ID: 2459961 • Letter: D
Question
D transferred property to T, as trustee, in trust, the income to be paid to X for X's life,remainder to Y if living at X's death or, if not,remainder to Z or Z's estate.
Will a part of the value of the property be included in Z’s gross estate if Z dies survived by X but not by Y? In the current year, what amount, if any, would be included in Z’s gross estate if the trust corpus is worth $100,00, X is 60 years old, the Section 7520(a)(2) interest rate is 4 percent, and Z’s estate uses a date-of-death valuation?
Explanation / Answer
a)It will be vested remainder instead of being a contigent remainder . Yes it would be included in Z's gross estate since this inclusion will be under 2033
b) though Z has not received any property or cash to pay the possibel tax liability but he will be required to include it in his gross estate . After the termination if the president interest or interests in the propery sec 6163 make election in order to defer payments until six months . But you have to accrue interest ( 100,000@ 6% = $6,000)
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