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I really don’t think it can be valued accurately. The parties might agree on some arbitrary number, but that is not a valuation.
<div>I had one case where the lifetime beneficiary was VERY wealthy, so we decided that the corporate trustee would be very unlikely to distribute any principal under the HEMS standard, and so we valued the potential HEMS distribution at zero, because the trust
allowed the trustee to take into account the beneficiary’s other resources. But that was an unusual situation.</div>
<div>Phil Jones</div>
<div>Portland, OR<br>
<br>
<div dir="ltr">Philip N. Jones
<div>Duffy Kekel LLP</div>
<div>Portland, OR</div>
<div>pjones@duffykekel.com</div>
<div>(503) 226-1371</div>
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<blockquote type="cite">On May 29, 2020, at 3:36 PM, Diane J. Kiepe <DJKiepe@depdslaw.com> wrote:<br>
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<p class="MsoNormal"><span style="font-size:16.0pt">How does one value a remainder interest in a trust fund when the lifetime beneficiary is entitled to principal distribution for HEMS, if the remainder beneficiaries agree for the trust to be terminated early
without compensation? Do you just ignore the potential principal payments to lifetime beneficiary and calculate the remainder interest on the assumption that no principal will be paid out?<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:16.0pt"><o:p> </o:p></span></p>
<p class="MsoNormal"><i><span style="font-family:"Script MT Bold"">Diane J. Kiepe<o:p></o:p></span></i></p>
<p class="MsoNormal"><i><span style="font-family:"Script MT Bold""><o:p> </o:p></span></i></p>
<p class="MsoNormal">Diane J. Kiepe<o:p></o:p></p>
<p class="MsoNormal">Douglas Eden<o:p></o:p></p>
<p class="MsoNormal">717 W. Sprague Ave.<o:p></o:p></p>
<p class="MsoNormal">Suite 1500<o:p></o:p></p>
<p class="MsoNormal">Spokane, WA 99201<o:p></o:p></p>
<p class="MsoNormal"><a href="mailto:djkiepe@depdslaw.com">djkiepe@depdslaw.com</a><o:p></o:p></p>
<p class="MsoNormal">509-455-5300<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
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