How much (if any) of the transfer is eligible for the gift tax marital deduction? Explain.

)          1.   How much (if any) of the transfer is eligible for the gift tax marital deduction? Explain.

2)          2.   Are the trust assets part of Donald’s taxable estate? What does this depend on? Explain.

3)          3.   Why are gifts to this trust not eligible for the gift tax annual exclusion? What could be done to change that? Please describe.

4)          4.   Are the trust assets part of Melinda’s taxable estate? Explain.

5)          5.   For income tax purposes, is this trust considered a “grantor trust”? Explain.