Split-Interest Trusts: Treatment of revocable trusts that become split-interest trusts


A revocable trust is not considered a split-interest trust for a reasonable period of settlement after becoming irrevocable, if both conditions listed below are present. (The tax on self-dealing may apply, however.)

  1. The trust becomes irrevocable when the decedent-grantor dies, and
  2. The trust's governing instrument provides that the trustee must hold some or all of its net assets in trust for both charitable and noncharitable beneficiaries after becoming irrevocable.

After that period, the trust is considered a split-interest trust.


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