Mallory would like to create an irrevocable trust for her children that will remove assets from her gross estate, but she is uncomfortable relinquishing all control of the property because her children are young and they may not prove to be financially responsible. She would like to be able to change the beneficiaries of the trust, perhaps to her grandchildren, or change the shares of each beneficiary in the event they waste their distributions. Will the retention of these powers affect the transfer to the trust?

A)

The powers retained by Mallory are insufficient to create an incomplete transfer.

B)

The transfer would be incomplete only if Mallory retained the right to receive trust income. The power to change the beneficiaries or their shares is not a significant retained power.

C)

The retention of such powers will cause the gift to be an incomplete transfer because she is not giving up sufficient control of the trust assets.

D)

A transfer to an irrevocable trust will remove the assets from Mallory's gross estate regardless of any retained powers.