Grantor-retained Income Trust (grit)
Irrevocable trust into which the grantor places assets and retains the income from or the use of these assets for a stipulated period of time. At the termination of this time period, the principal (assets) of the trust is transferred to the grantor's non charitable beneficiary. The non charitable beneficiary may include individual (s) such as a grandchild, niece, nephew, son, or daughter. Should the grantor survive the stipulated period of time, he or she will incur substantial savings in estate and gift taxes. In order for these savings in taxes to occur, the following requirements must be met by the grantor:
- income to the grantor must be the sole result of the income generated by assets held in the trust.
- any income generated by the assets held in the trust can be paid only to the grantor of the trust.
- neither the grantor nor the spouse of the grantor can act as a trustee of the trust.
- any income retained by the grantor must be for a period of time not to exceed 10 years.
Popular Insurance Terms
Coverage outside an insured's home for personal items usually carried or worn while traveling. Protection is for personal property (apparel and jewelry), not for real property or property ...
Fund established to pay specified losses, usually the low severity property losses. This type of account is an excellent device in conjunction with a self-insurance plan, in which the fund ...
Any of a number of types of surety bonds that the law requires of government contractors, licensed businesses, litigants, fiduciaries, government officials, and others whose performance of ...
Same as term Office Burglary and Robbery Insurance: coverage for the office of a business, or an individual in a general office building or other structure. Includes burglary of a safe; ...
Organization formed to encourage research in insurance and to foster an exchange of ideas and research methodology among the society members. ...
Sum it takes to replace an insured's damaged or destroyed property with one of like kind and quality, equivalent to the actual cash value, minus physical depreciation (fair wear and tear) ...
difference between the face value of a permanent life insurance policy and its accrued cash value. The pure cost of protection is based on this difference. For example, if the face value ...
Compensation payable to the owner of a ship detained for reasons beyond his or her control who incurs a loss of earnings because of the delay. Detainment can be caused by a delay in the ...
Same as term Contingent Business Income Coverage Form: coverage for loss in the net earnings of a business if a supplier business, subcontractor, key customer, or manufacturer doing ...
Have a question or comment?
We're here to help.