GRANTOR TRUST

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Under this Trust the Grantor(s) (partyfsj transferring property into the Trust for the benefit of specific named beneficiaries) retains so much control over the use or enjoyment of the property transferred that, for tax purposes, he is deemed the owner. This generic term derives from the provisions of §§671 – 678 of the Internal Revenue Code. It is significant mainly in the federal income, estate and gift tax realm. The retention of control by the Grantor of the trust results in imposition of taxes on earnings from the property on his (the Grantor’s) taxable estate and not the taxable estate of the named beneficiaries