Charitable trust that is an irrevocable trust and that may be testamentary or inter-vivos (Between living persons) is called:
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A. B. C. D.D
The correct answer is C. Charitable Remainder Annuity Trust (CRAT).
A charitable trust is a type of trust that is set up for charitable purposes. It is an irrevocable trust, meaning that once it is established, it cannot be changed or revoked. There are two types of charitable trusts: testamentary trusts and inter-vivos trusts.
A testamentary trust is a trust that is established through a person's will and goes into effect upon their death. An inter-vivos trust, also known as a living trust, is established during the lifetime of the person who creates it.
The Charitable Remainder Annuity Trust (CRAT) is a type of charitable trust that is irrevocable and can be either testamentary or inter-vivos. In a CRAT, the donor contributes assets to the trust and receives an annual payment from the trust for a specified term or for the donor's lifetime. At the end of the term or the donor's lifetime, the remaining assets in the trust are distributed to one or more charitable organizations.
The key feature of a CRAT is that the annual payment to the donor is a fixed dollar amount, which is determined at the time the trust is established. This means that the donor knows exactly how much income they will receive from the trust each year.
Other options listed in the answer choices are not correct in this case. A Foundation is a separate legal entity established to carry out a specific charitable purpose. A Charitable Remainder Unitrust (CRUT) is a type of charitable trust that provides the donor with a variable annual payment based on a percentage of the trust's assets. None of these options fits the description of a charitable trust that is both irrevocable and may be testamentary or inter-vivos, except for the Charitable Remainder Annuity Trust (CRAT).