| Course | GF593 Estate Planning |
|---|---|
| Unit | Unit 5 |
| Paper type | Trust structure memo |
| Length | About 1,040 words, 6 pages double-spaced |
| Format | APA 7 student paper |
| School | Purdue University Global |
| Program | MS in Finance |
| Updated | October 2026 |
Free sample paper for GF593 Unit 5
Protected but Not Controlled: A Unit 5 Trust Structure Memo on Lifetime Trusts for Three Adult Children
[Student Name]
Purdue University Global
GF593: Estate Planning
Unit 5 Trust Structure Memo
[Instructor Name]
[Date]
The couple, their children, their property and every amount are composite and illustrative; the statute, tax figures for 2025 and sources cited are real; this memo is coursework, not legal advice.
Recommendation
To: Richard and Joyce Avery From: [Planner name] Re: How to leave your estate to Meredith, Grant and Lucy
I recommend three steps. First, each of you signs a revocable trust now, and the Raleigh house and the Pawleys Island condo are deeded to the trusts. Second, at the second death the estate divides into three equal shares, and each share stays in its own trust for that child's lifetime, with the child as co-trustee alongside an independent trustee. Third, the retirement accounts name those three trusts as beneficiaries, with language written specifically for retirement money.
The Facts This Memo Relies On
You are 66 and 63. Your estate is about $2,500,000: the house, $610,000; the South Carolina condo, $420,000; retirement accounts, $850,000; brokerage and cash, $370,000; and a $250,000 life policy. Each child's share would be about $833,333.
Meredith, 40, is an emergency physician in Atlanta. Her malpractice coverage has limits, and a judgment above them could reach her personal assets. Grant, 37, married three years ago, his second marriage. Lucy, 33, teaches and has no particular risk. You told me you want the shares equal, you do not want to treat any child as untrustworthy, and you want each child to have real say over the money.
Four Structures Compared
1. Outright equal shares. Each child receives $833,333 directly. This is simplest and cheapest. It offers no protection: Meredith's share would be available to a judgment creditor, and if Grant deposited his share into a joint account, it could become marital property in a later divorce.
2. Staged distributions, such as a third at 40, 45 and 50. This works for young heirs, but Meredith is already 40 and would receive a third at once. Every distributed dollar loses its protection, so the structure fades exactly as the children reach their highest-earning years.
3. Lifetime trusts with the child as co-trustee. Each share stays in trust for life. The child and an independent trustee manage it together. The child can receive whatever is needed for health, education, maintenance and support, and the independent trustee can approve anything more. A spendthrift clause prevents creditors from reaching the trust before money is distributed (N.C. Gen. Stat. § 36C-5-502, 2025). Because the property never leaves the trust, it cannot be mixed with marital assets. At the child's death, the child decides who receives what remains among his or her own descendants.
4. An irrevocable trust funded today. This would remove assets from your estate now, but your estate is far below the $15,000,000 federal exclusion for 2026, so there is no estate tax to save. You would give up control and access during your lives for no tax benefit.
Structure 3 is the only one that protects all three shares for life without taking control away from the children; the protection comes from where the money is held, not from distrust of who holds it.
Why Lifetime Trusts Fit This Family
Meredith. A trust created by you for her benefit, with a spendthrift clause, is generally beyond the reach of her creditors as long as distributions remain in the trustee's discretion. A personal judgment above her coverage could not reach the trust principal.
Grant. North Carolina already treats an inheritance as separate property in a divorce, but that protection is easily lost when inherited money is deposited into joint accounts or used to pay down a jointly owned house. Inside a trust, the property stays separate.
Lucy. She gets the same structure, which keeps the shares equal and avoids singling anyone out. She can use her trust much like her own account, subject only to the independent trustee's approval for large distributions.
Trust Duration and Location
Lifetime trusts can last for a child's whole life and then continue for grandchildren. Many families now create trusts designed to last for generations, and states that relaxed their limits on trust duration have attracted substantial trust assets as a result (Sitkoff & Schanzenbach, 2005). For your family, a trust lasting for each child's life, with the option to continue for grandchildren, is sufficient.
The Two States
Real estate passes under the law of the state where it is located, so the Pawleys Island condo would otherwise require a separate probate in South Carolina. Deeding both properties to your revocable trusts now avoids probate in both states.
The Retirement Accounts
The $850,000 in retirement accounts needs separate attention. Adult children who inherit retirement accounts must generally withdraw the balance within ten years (Internal Revenue Service, 2025). If the trust keeps those withdrawals instead of paying them out, the trust pays income tax at its own rates, which reach 37 percent above $15,650 of income in 2025. Each child's share of the retirement accounts, about $283,333, would produce withdrawals of roughly $28,000 a year or more.
The trust should therefore let the independent trustee choose, each year, whether to pay withdrawals out to the child at the child's lower rate or keep them in the trust for protection. That flexibility costs some tax in years when protection matters, which is a tradeoff you should decide with your attorney.
Costs
Expect drafting fees for two revocable trusts, deeds for both properties and beneficiary changes. After the second death, each lifetime trust files its own tax return and may pay an independent trustee a fee. These costs are real, but they are small compared with what one uninsured judgment or one divorce could take.
Next Steps
1. Meet with your attorney to draft the revocable trusts and the lifetime trust terms.
2. Choose the independent trustee for each child's trust.
3. Sign deeds for the house and the condo.
4. Update the retirement account beneficiary forms to name the three trusts.
5. Explain the plan to the children together, so each understands why the structure is the same for all three.
References
Internal Revenue Service. (2025). Distributions from individual retirement arrangements (Publication 590-B). https://www.irs.gov/publications/p590b
N.C. Gen. Stat. § 36C-5-502 (2025).
Sitkoff, R. H., & Schanzenbach, M. M. (2005). Jurisdictional competition for trust funds: An empirical analysis of perpetuities and taxes. Yale Law Journal, 115(2), 356-437.
The Purdue Global GF593 Unit 5 instructions
For Unit 5, GF593 hands you a family and asks which trust structure fits it. Lead with the recommendation, addressed to the clients, so they know the answer before the reasoning. State the facts the memo relies on, including each child's circumstances and the clients' wishes about equality and control. Then compare at least four structures, such as outright shares, staged distributions, lifetime trusts and an irrevocable trust funded now, judging each against the same criteria: protection from creditors and divorce, the child's control, probate in every state where property sits, taxes and cost. Explain why the chosen structure fits each child, not only the family in general. Address retirement accounts separately, because naming a trust as beneficiary raises timing and income tax questions. Close with costs and next steps. Cite the state's spendthrift statute, IRS Publication 590-B and research on trust duration in APA 7.
Inside the GF593 Unit 5 example
The memo opens with three numbered steps: revocable trusts and deeds now, lifetime trusts at the second death and retirement forms naming those trusts. A facts section lists $2,500,000 of assets and the three children's situations. Four structures follow on one set of criteria; outright shares and staged payouts fail on protection, and an irrevocable trust funded today fails because there is no estate tax to save. The highlighted sentence states why lifetime trusts protect without distrust. Separate paragraphs apply the structure to Meredith's malpractice exposure, Grant's marriage and Lucy's equal treatment, citing North Carolina's spendthrift provision. Sitkoff and Schanzenbach's study supports a note on trust duration. A paragraph explains the second probate a South Carolina condo would otherwise need. The retirement section prices the 37 percent trust rate above $15,650, and costs and five steps close the memo.
Reading the GF593 Unit 5 grading rubric
The rubric for this GF593 memo rewards a clear recommendation backed by a fair comparison. Instructors check that every alternative is judged on the same criteria and that the rejected options are rejected for stated reasons, not dismissed. Applying the chosen structure to each child separately shows the writer understood the family rather than reciting trust features. Accuracy on the protective mechanisms carries weight: a spendthrift clause, discretionary distributions and segregation of inherited property each do different work. The retirement account section is often where strong memos separate from average ones, because it requires weighing creditor protection against higher income tax inside the trust. Two-state probate should be handled explicitly. Costs stated honestly add credibility. The North Carolina statute, IRS Publication 590-B and the Yale Law Journal study, in APA 7, ground the recommendation without making it read like a legal opinion.
Common GF593 Unit 5 mistakes, and how to avoid them
Many GF593 Unit 5 memos recommend a trust without explaining why the alternatives fail for this family. Some describe staged distributions for adult children who have already passed the stages. Others claim a trust protects against every creditor, when protection depends on spendthrift language and discretionary terms. Divorce protection is often overstated or misunderstood; inherited property is usually separate already, and the trust's role is to keep it from being mixed. Writers frequently forget the second state where a vacation property sits. The retirement account section is the most common gap: naming a trust can raise income tax sharply if withdrawals stay inside it, and the memo should say who decides that each year. Memos also slip into a lecture on trust law. Write to the clients, keep the comparison on one set of criteria, and tie each feature to a named child.
Get a GF593 Unit 5 example written to your instructions
Name the Unit 5 family, the structures your prompt asks to compare and the state, and attach the rubric. A recommendation lands in the memo's first paragraph, and each alternative is then tested against the family's own purpose before cost enters the discussion. Opening sample at no charge, within 24-48h. The paper above is an original model document written by our desk, not a submitted student paper and not an official Purdue University Global document.
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GF593 Unit 5 questions, answered
Where can I find a free GF593 Unit 5 sample paper?
This page carries a full GF593 Unit 5 trust structure memo for a North Carolina couple with three adult children, comparing four structures and recommending lifetime trusts with co-trustees, with a retirement account section and APA 7 references.
How does a lifetime trust protect a child from a malpractice judgment?
Property held in a trust created by the parents, with a spendthrift clause and distributions left to the trustee's discretion, generally cannot be reached by the child's creditors before it is paid out. A judgment above Meredith's insurance limits would not reach the trust principal.
Does the child lose control of the money in a lifetime trust?
Not in the memo's design. Each child serves as co-trustee and can receive funds for health, education, maintenance and support, while the independent trustee approves larger distributions. The child also decides who receives what remains at his or her death.
Why does naming a trust on an IRA raise income tax?
Adult children generally must withdraw an inherited account within ten years. If the trust keeps those withdrawals, it pays tax at trust rates that reach 37 percent above $15,650 in 2025, so the memo gives the trustee discretion to pay withdrawals out when the child's rate is lower.
Why not fund an irrevocable trust today?
The couple's $2,500,000 estate is far below the federal exclusion, so removing assets now saves no estate tax. They would give up control and access during their lives for no benefit, which is why the memo rejects that structure.