Browse by letter:

A B C D E F G H I J K L M
N O P Q R S T U V W Y Z

Trusts & Estates Glossary: I

IDENTIFYING NUMBER:
A number provided by the Internal Revenue Service for tax purposes. In the case of an individual, it is his or her Social Security number.

IMMEDIATE BENEFICIARY (Present Beneficiary, Primary Beneficiary):
A beneficiary of a trust who is entitled to receive immediate benefits from the trust property, whether or not limited to income; opposed to ultimate beneficiary.

IMPLIED TRUST:
A trust created by operation of law or by judicial construction, to be distinguished from an express trust which is created by express language, oral or in writing.

INACTIVE TRUST:
A trust in which the trustee has no duty except to hold title to the property.

INCIDENTS OF OWNERSHIP:
The rights of the insured or his estate to the economic benefits of an insurance policy which make the proceeds of the policy subject to estate tax.

INCLUSION RATIO:
For generation-skipping tax purposes, a ratio that is used to determine the portion of a trust or property transferred in a direct skip subject to generation-skipping tax.

INCOME:
The returns from property, such as rent, interest, dividends, profits, and royalties; opposed to principal or capital.

INCOME BENEFICIARY:
The beneficiary of a trust who is entitled to receive the income from it.

INCOME BOND:
An obligation in which the promise to pay interest is conditional upon the earnings of the obligor. Usually interest is to be paid in any year only if it is earned.

INCOME IN RESPECT OF A DECEDENT ("IRD"):
Income items and deductible obligations that would have been receivable or payable by the decedent had he lived and that are received or paid by his estate or successors to the property have the same tax consequences to the estate or successors when received or paid and retain the same character they would have had in the hands of the decedent.

INCOMPETENT PERSON:
One who is legally incapable of managing his affairs because of mental (not physical) deficiency.

INDENTURE:
A mutual agreement in writing between or among two or more parties whereof usually each party has a counterpart or duplicate; originally so called because the parts were indented by a notched cut or line so that the two parts could be fitted together.

INDEPENDENT EXECUTOR:
An executor of a Will who, after filing his inventory, does not make further accounting to the probate court; recognized by statute in only a few states.

INDIVIDUAL RETIREMENT ACCOUNT ("IRA"):
A retirement savings program for individuals to which yearly tax deductible contributions up to a specified limit can be made. The amounts contributed are not taxed until withdrawal. Withdrawal is not permitted, without penalty, until the individual reaches age 59-1/2.

INFANT:
A person not of legal age, which at common law was 21 years but which in some states has been changed by statute; the same as a minor.

INHERITANCE TAX:
A tax on the right to receive property by inheritance; to be distinguished from an estate tax.

INHERITANCE TAX RETURN:
The return that the executor or administrator is required to make to the state on the basis of which the inheritance tax due the state is calculated and paid; to be distinguished from the federal estate tax return.

IRREVOCABLE TRUST:
A trust which by its terms (1) cannot be revoked by the settlor or (2) can be terminated by him only with the consent of someone who has an adverse interest in the trust—that is, someone to whose interest it would be for the trust not to be terminated, such as a beneficiary; to be distinguished from a revocable trust with consent or approval.

ISSUE:
All persons who descended from a common ancestor; a broader term than children.

ITEMS OF TAX PREFERENCE:
For purposes of the alternative minimum tax, those exemptions and deductions which are excluded in determining taxable income for regular income tax purposes, but which are included in determining taxable income against which the alternative minimum tax is calculated. Items of tax preference are sometimes referred to a "ITPs" or "TPIs" (Tax Preference Items).