Please answer the following questions about trusts:
a. What are the different methods of creating trusts?
b. What parties are indispensable to a trust?
c. What is the purpose of the rule against perpetuities?
d. Identify three reasons why someone might wish to create a trust. How would they accomplish their purposes?
a. Trusts are created inter-vivos (life) or by will.
b. Settlor, trustee, and beneficiary.
c. The rule is designed to prevent the settlor from escaping death taxes on all future transfers, and from controlling property "from the grave" for an unreasonably long period of time.
d. To avoid probate; to care for an elderly spouse or parent, or the settlor, if subsequently incapacitated; to care for a minor child; to avoid estate and inheritance taxes; to protect an improvident child from creditors; to allow gifts to be made using the trustee's judgment after the settlor has died; and to allow continued beneficial ownership without conflict of interest (blind trusts). The student should discuss the conditions to be given to the trustee in order to effectuate the trust's purposes.
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a. True b. False Indicate whether the statement is true or false
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