In 2023, Paul establishes an irrevocable trust for the benefit of his four grandchildren as equal beneficiaries. Paul contributes $65,000 to the trust in 2023, and he plans to contribute the same amount each year going forward. The trust provides that each beneficiary has the right, during a 30-day period each year, to withdraw the lesser of the gift tax annual exclusion amount or one-fourth of the annual trust contribution. No grandchild exercises their right of withdrawal during 2023. Which of the following statements regarding the transfer tax consequences of this arrangement is (are) CORRECT?

1. Paul's gift to the trust in 2023 is eligible for the annual exclusion because the withdrawal right makes it a future interest.

2. Each grandchild has made a taxable gift to the other in 2023.

3. Only Paul must file a gift tax return for 2023.

A.	1, 2, and 3
B.	2 only
C.	None of these statements is correct.
D.	2 and 3