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GiftLaw Pro Home   >  Chapter 1 - Taxation and Giving  >  1.4 Generation-Skipping Tax Deductions  >  1.4.4 Lead Annuity Trust GSTT  >  Basic Quiz

Basic Quiz - 1.4.4 Lead Annuity Trust GSTT

1. Charitable lead trusts (CLTs) are excellent vehicles to benefit grandchildren while minimizing transfer taxes.
           
2. An excellent way to get a "double discount" is to combine a FLP or LLC with a CLT.
           
3. With a charitable lead annuity trust (CLAT), the applicable fraction (and therefore the inclusion ratio) is computed at the creation of the trust.
           
4. The allocation of GSTT exemption to a charitable lead annuity trust (CLAT) is a straightforward process.
           
5. A charitable lead trust for grandchildren (or children) gives an example of a taxable distribution.
           
6. A taxable distribution occurs when there is a distribution from a trust to a skip person.
           
7. A taxable termination only occurs when a trust loses its tax-exempt status.
           
8. In the case of a taxable termination, the trustee shall pay the GSTT due.
           
9. Jacqueline Kennedy Onassis's will created a testamentary charitable lead annuity trust.
           
10. A charitable lead annuity trust produces the highest charitable deduction when used in conjunction with the highest applicable federal rate (AFR or Rate of the Month).