Gwen establishes an irrevocable trust and transfers $10,000,000 to Friendly

National Bank as Trustee. What are the gift tax consequences of the following

alternatives?

a. Income to Alex for life, remainder to Evan.

b. Income to Alex for life, remainder to Evan. The trustee has complete

discretion whether to distribute income to Alex or to accumulate it.

Accumulated income will be paid to Alex’s issue.

c. Income to Alex and Betsy in equal shares, remainder to Evan.

d. The trustee has complete discretion to distribute income in whatever

proportion to Alex, Betsy, Claude, and Dinah. The remainder goes to Evan at

the death of the last income beneficiary.

e. Income to Alex for life, remainder to Evan. Alex is 25 years old when the

trust is established. The trustee has discretion to accumulate income or

distribute it to Alex for health, education, or an emergency