Richard placed his portfolio of income-producing stock valued at $200,000 into an irrevocable trust. The trust provides that the trustee is to pay to Richard 7% of the initial value of the trust annually for a period of 12 years. After the 12-year term, the trustee is directed to pay the remaining assets in the trust to Richard's daughter. Which of the following are CORRECT statements regarding the income, gift, or estate tax implications of this trust arrangement? Richard will owe a gift tax based on the present value of the remainder interest given to his daughter. Taxation of the income earned by this trust will be affected by the grantor trust rules. If Richard dies during the 12-year term of the trust, the trust assets will be included in his gross estate. The right that Richard has retained in this trust is considered to be "qualified" for purposes of the Chapter 14 rules.
