Chartered Retirement Planning Counselor (CRPC) Practice Exam 2025 - Free CRPC Practice Questions and Study Guide

The primary feature of a Grantor Retained Interest Trust (GRIT) is that the grantor can receive all income earned by the trust. This type of trust is set up in a way that allows the grantor to retain an interest in the income generated by the assets placed in the trust for a specific period, while ultimately benefiting others (usually beneficiaries) after that period ends. This characteristic enables the grantor to enjoy the income generated from trust assets while also allowing for estate tax benefits by potentially reducing the taxable estate through the transfer of assets to beneficiaries after the grantor's retained interest expires.

The ability of the grantor to access and receive income is a distinguishing factor of GRITs compared to other types of irrevocable trusts, where the grantor usually cannot benefit from the trust assets once they are transferred. This design promotes wealth management strategies, allowing families to transfer assets while still maintaining some income benefits during the trust’s duration.