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GiftLaw Pro Home   >  Chapter 6 - Charitable Deduction Methods  >  6.7 Remainder Unitrusts  >  6.7.1 Life or Lives Unitrust  >  Basic Quiz

Basic Quiz - 6.7.1 Life or Lives Unitrust

1. A charitable remainder unitrust (CRUT) pays a fixed percentage of the trust value to the income beneficiary.
           
2. A charity cannot be an income beneficiary of a CRUT.
           
3. A unitrust may be created for no more than two lives.
           
4. The applicable federal rate (AFR) is not used to calculate the amount of a donor's charitable deduction.
           
5. A unitrust may be created for the life of a beneficiary with a guaranteed number of years.
           
6. If the guaranteed years option is selected, the charitable income tax deduction is reduced.
           
7. A unitrust may be created for the lesser of a life or a term of years.
           
8. If the income beneficiary passes away prior to the 20 year term of a unitrust created for the lesser of a life or a 20 year term, any remainder will be distributed to the income beneficiary's family.
           
9. A lesser of life or term of years unitrust results in a larger charitable deduction than a straight term of 20 years.
           
10. A lower AFR produces a higher charitable income tax deduction for remainder unitrusts.