If each trust beneficiary has the so-called Crummey demand powers, transfers to the trust may qualify as a present-interest gift to the beneficiaries. In their simplest form, these powers should allow the beneficiary the right to demand the lesser of (1) the annual addition to the trust, (2) $5,000, or (3) 5% of the trust corpus at the time the power is exercised. See hanging powers for a discussion of a more complex form of these demand powers.

 

 

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