In which of the following independent situations has Trent made a gift?
a. Trent established an irrevocable trust, income payable to himself for life and, upon his death, remainder to his children.
b. Trent dies owning a U.S. savings bond with ownership listed as: "Trent, payable to Sue on Trent's death.". Sue redeems the bond.
c. Trent sends $25,000 to Alice's oral surgeon in payment of her dental implants. Alice is Trent's sister and does not qualify as his dependent.
d. Trent pays Eva $800,000 in a property settlement of her marital rights. One month later, Trent and Eva are divorced.
a
RATIONALE: Choice a. is a complete transfer—there is no retention of a right to revoke the trust and he has made a gift of the remainder interest. Choice b. is not a gift but is a testamentary transfer. Payment was made directly to the provider of another's medical expenses and is, therefore, not a gift (choice c.). Code § 2516 treats property settlements incident to divorce as being for full and adequate consideration (choice d.).
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