Final answer:
The disadvantage of a revocable trust is that the trust assets are subject to being probated upon the death of the grantor. The other options are not disadvantages since the grantor maintains control for tax purposes, and there are no gift taxes on transfers to the trust.
Step-by-step explanation:
The correct answer to the question "Which of the following is a disadvantage of a revocable trust?" is A) The trust assets are subject to being probated upon the death of the grantor. This disadvantage is tied to the fact that a revocable trust can be altered or revoked by the grantor during their lifetime. At the death of the grantor, the trust typically becomes irrevocable, and the assets may go through probate, which is the legal process of transferring the deceased person's assets to the heirs.
While B) The grantor loses power to control the trust funds for federal estate tax purposes, and C) The grantor will be subject to gift taxes on the transfer of property to the trust are significant considerations, they are not disadvantages of a revocable trust. The grantor generally maintains control over the trust assets for federal estate tax purposes as it is included in the grantor's taxable estate. Also, transfers to a revocable trust are not completed gifts for gift tax purposes, so the grantor is not subject to gift taxes upon the initial transfer of property into the trust.