George Hostetler established an irrevocable life insurance trust and funded it with a $2 million face value policy on his life. After his death, income of the trust is distributed at the discretion of the corporate trustee to George's wife and children. The trust is to terminate 25 years after George's death, when trust assets are to be distributed to George's surviving descendants per capita at each generation. Since George had no descendants other than his children at the time this trust was established, he expressly elected not to assign any of his generation-skipping transfer tax (GSTT) exemption to this trust. Which one of the following is a correct statement about the application of the GSTT to this trust? The GSTT will not be applicable to this trust since it violates the rule against perpetuities. The GSTT will not apply to this trust because George did not assign any of his GSTT exemption. The GSTT will apply when a taxable termination occurs. The GSTT cannot apply to this trust since no skip parties were in existence when it was established