Question
Herb transfers a life insurance policy on his life to a Uniform Gifts to Minors Act account for the benefit of his granddaughter, and Herb
Herb transfers a life insurance policy on his life to a Uniform Gifts to Minors Act account for the benefit of his granddaughter, and Herb names himself as custodian. In that capacity, Herb can make discretionary distributions of the UGMA funds to or for the granddaughter's benefit until she attains age 21, at which point the granddaughter can demand distribution of the remaining property. Herb cannot use the UGMA funds for his own benefit. If Herb dies while the policy remains titled in his name as custodian, will the proceeds be included in his gross estate under 2042? How would your answer to (a) change if Herb were one of two co-custodians of the account? c.How would the answer change if Herb's wife originally owned the policy and she transferred it to the UGMA account (of which Herb still serves as custodian)? Hellwig, Brant J.; Danforth, Robert T.. Estate and Gift Taxation, Third Edition (p. 179). Carolina Academic Press. Kindle Edition.
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