salbelmae[at]hotmail.com (sallie mae) wrote:

- quote -

Why make it a Crummey trust rather than a regular
irrevocable trust? Assuming your son is under 18, the
differences are:

• Under a Crummey trust you will be able to give an
additional $11,000 without gift tax consequences; but

• all taxable income of the trust will accrue to your son
for tax purposes, whether he has income to pay the tax or
not. With another irrevocable trust, the trust itself will
be the tax paying entity.

• Whichever trust you use, you cannot be the trustee of the
trust, or you will be considered the owner for income tax
purposes.

- quote -

Yes, assuming no taxable gifts were or will be made to your
son (or anyone else, for that matter) during your lifetime.

But that would be the same with an outright gift or a gift
to another kind of irrevocable trust.

- quote -

You could give $1,011,000 this year and another $511,000
next year if you use a Crummey trust. At least as far as
estate tax is concerned. For gifts made through December
31, 2009, the gift tax limit appears to be just the first
million, though.

- quote -

So it would appear.

Stu

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albelmae[at]hotmail.com (sallie mae) wrote:

- quote -

Correct.

**Dan Evans
**I post information, not advice.

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I am want to give one million dollars to my son under trust
with Crummey clause, with thirty days notice to guardians
(me and my ex-husband) to take over the gift. I am expecting
that it is going to lapse and everything will then fall
under trust control.

1) If the gift lapses and becomes subject to trust
conditions, after thirty days, is it correct that me or my
son will have no estate taxes or gift taxes (because of
unified gift and estate tax credit for lifetime currently at
one million dollars).

2) Account told me that if I wait till next year, limit goes
to one and a half million dollars and there will be no
estate tax ot gift tax on that amount if I did the trust
next year.

Another financial planner told me that 1.5 million credit is only for
estate tax and that the gift tax will kick in after one million.

Which one it true? Please help.

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