Sadly, on March 15, 2017 Mr. Brown passed away. Upon his death, Mr. Brown's estate was transferred into a trust for the benefit of Mrs. Brown. Per instructions in Mr. Brown's will, the income of the trust shall be paid out to Mrs. Brown.The will also allow the executors to pay out capital for the benefit of Mrs. Brown.On Mrs. Brown's death, the trust's assets are to be distributed to the Brown children.Mr. Browns' assets include shares of iLoveTax Inc.a public company which were purchased about 25 years ago for $1000 and have a fair market value at his death of $100,000.The stranger has asked that you for the following:

1)Explain the tax consequences to Mr.Brown arising from the transfer of the iLoveTax Inc. shares to the trust for Mrs. Brown.

2)Explain the tax consequences to the trust of holding the shares and earning dividend income

3)Explain the tax consequences if the shares are transferred to Mrs. Brown.