The new partner concluded that the trust did not qualify as a generation-skipping trust
and that a 40% generation-skipping transfer (GST) tax applied to the distribution.
* The increases for the lifetime gift tax exemption and the generation-skipping trust
tax exemption are the same: up to $5.43 million from $5.34 million in 2014, and a 40 percent top federal tax rate.
* The IRS issued a private letter ruling addressing the tax treatment of a generation-skipping trust
created in 2010, when the estate tax was not in effect.
This generation-skipping trust
would not be taxed in the estates of Henry's children.
(GST) planning has become more common over the last 20 years, as successful business owners, executives and wealthy individuals have enjoyed economic success.
Establish a Generation-Skipping Trust
. For couples, there's no better time than now to take advantage of both spouses' $5 million exclusion--instated with the Tax Act--to establish a generation-skipping trust
If the parent of a grandchild-distributee died after the transfer by a grandparent to a generation-skipping trust
but before the distribution from the trust to the grandchild and a reverse QTIP election had been made, the distribution was a taxable termination and the "step-up in generation" rule was not available.
Make Low Interest Rate AFR Loans to a Generation-Skipping Trust
(or Children or Grandchildren) for Investment Opportunities
Chapter topics include dealing with clients, a review of fundamentals of drafting wills, the wealthy young adult contemplating marriage, young married couples with and without children, unmarried couples, gifts from grandparents, remarriage with children, migratory married couples, the married small business owner or investor, asset protection and retirement planning, the generation-skipping trust
, charitable gifts, planning for incapacity, federal wealth transfer tax principles and planning strategies, and probate and an estate tax return.
First, where a client stands to inherit a substantial estate from a parent and already has a substantial estate of his own, a generation-skipping trust
would be set up to receive the parent's property for the benefit of the client.
But, says Evelyn Capassakis, partner in charge of the trust and estates group at New York-based PricewaterhouseCoopers, "if you're older, you may not want to risk a GRAT because it doesn't work unless you outlive your retained term." The Legacy Trust, for another example, offered by the Preservation Group, based in Carlsbad, CA, is a proprietary three-in-one trust, or a combination of a dynasty trust, an income trust, and a generation-skipping trust
. You, as the grandparent set up this trust and designate four beneficiaries at $1 million apiece into the legacy trust.
The first four chapters of the book (which, like most of the others, are previously published essays tailored slightly and ordered to present as coherent a progression as possible) articulate various patterns of dynastic decentering, analyzing in detail the emergence of non-family fiduciaries as dynastic managers; the characteristic relations of the founder's children, grandchildren, and more remote descendants to each other, to the fiduciaries, and to the dynasty as a whole; the specific role of the generation-skipping trust
as the principal instrument for shaping relations within the dynasty; the usual arc of dynastic formation and dissolution (spanning about a century); and a host of other matters pertaining to the dynasty as an institution.