Monday, April 29, 2024
Charitable Deduction Methods

6.4.1 Basic Quiz -- Living Grantor Lead Trust
A charitable lead trust in which a reversionary interest in the corpus is given to the grantor and such interest exceeds 5% of the corpus is a grantor lead trust (GLT).
     True      False
Any income or gain made in a GLT is taxable to the grantor.
     True      False
The grantor of a GLT does not receive a charitable deduction.
     True      False
Distributions from a GLT are considered made to the charity and any deduction for such distributions is limited to 50% of the grantor's adjusted gross income (AGI).
     True      False
If a GLT recognizes gain, the grantor is not taxed on that gain until the trust reverts.
     True      False
The highest applicable federal rate (AFR) available should be selected when creating a GLT.
     True      False
If a GLT invests in municipal bonds, the grantor nevertheless is subject to tax on the bond payments.
     True      False
The grantor is taxed at capital gains rates if a GLT is funded with appreciated stock.
     True      False
A portion of the sale of appreciated stock in a GLT may not be subject to taxation.
     True      False
The typical donor who creates a GLT is a person in the top income tax bracket.
     True      False



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