Apocalypse Trust

Apocalypse Trust means:
an agreement under which a taxpayer transfers all assets to a trust and also assigns his or her lifetime services to the trust. For example, a doctor or dentist may transfer his or her place of business to a trust. The beneficiaries are generally the taxpayer's family, with the grantor retaining broad powers over the income and corpus of the trust. The trust collects all of the taxpayer's income and deducts all of the taxpayer's expenses. The purpose of this arrangement is to shift income to taxpayers in lower tax brackets as well as to avoid the estate tax. At least four revenue rulings bar the use of apocalypse trusts.