The interest that goes to the beneficiaries.

• A. Retained interest
• B. Testamentary trust
• C. Remainder interest
• D. Income-producing assets

Answer: (C)

The concept here is the remainder interest. In property arrangements like a life estate, there is an existing possessory right for a period (the life tenant’s life) and a future interest that will go to others once that period ends. The future interest that is left to the heirs or beneficiaries is the remainder. For example, if O says “to A for life, then to B,” A has a life estate now, and B holds the remainder because B will receive ownership after A’s death.

Why this fits best: the phrase “the interest that goes to the beneficiaries” describes a future ownership right that remains after the prior estate ends, which is precisely the remainder. The other terms don’t capture that concept: a retained interest would mean the grantor keeps rights; a testamentary trust is a vehicle created by a will, not the specific type of future interest; and income-producing assets describe the property itself, not the form of the beneficiary’s interest.