Arthur Zolnick died at age 84 on June 7, 2013 In March 2007, he transferred $4 million of stock to a charitable remainder annuity trust (CRAT) from which he named himself to receive $280,000 per year for life He designated a charitable organization to receive the remainder interest after his death ...

No The IRS is correct in disallowing the deduction Unfortunately under the IRC Arthurs good deeds s ...

Arthur Zolnick died at age 84 on June 7, 2013. In March 2007, he transferred $4 million

Question:

Arthur Zolnick died at age 84 on June 7, 2013. In March 2007, he transferred $4 million of stock to a charitable remainder trust (CRAT) from which he named himself to receive $280,000 per year for life. He designated a charitable organization to receive the remainder interest after his death and appointed his nephew Luther as trustee. Luther never distributed cash to Arthur because Arthur indicated he had no need for additional funds that "would just add to my gross estate." At Arthur's date of death, the value of the assets in the CRAT had risen to $4.3 million. Another firm prepared the estate tax return, on which it claimed a charitable contribution deduction for the CRAT. The IRS proposed disallowing the deduction. Arthur's executor has asked your firm to address whether a charitable contribution deduction should be available.
Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,...