38 CRTs, GRATs
, and QPRTs are statutorily sanctioned trusts under the I.
111) GRITs, and for that matter GRATs
and GRUTs, divide interests in property into a present interest and a future interest.
When considering a GRAT
strategy, we first calculate the core capital and then quantify how much wealth to put into GRATs
to move the desired amount of excess capital to the next generation over a certain time horizon.
Because of these advantages, the increased use of life is likely to rise substantially subsequent of new restrictions on short-term GRATs
To prevent this short term hedging and planning that circumvents estate and gift tax, congress has tried to push through legislation that would make the GRAT
trust less desirable and less effective, such as requiring a 10-year term or that there be trust remainder (not all principal returned to the settlor).
Qualified personal residence trusts (QPRTs) are similar to GRATs
in some ways.
In general, to qualify for a GRAT
, there must be a fixed annuity amount paid at least annually without the possibility of commutation or payment via a note.
Grantor created a GRAT
with an annuity of $1,000 ($12,000 annual) payable at the end of each month to Grantor for 10 years, with remainder to Grantor's child.
A further three per cet cut i coucil grats
to all volutary orgaisatios ad charities.
Techniques such as GRITs (grantor retained income trusts), GRATs
(grantor retained annuity trusts), and GRUTs (grantor retained unitrusts) can result in hundreds of thousands and even millions of dollars of estate transfer cost savings as well as significant income tax advantages.
or qualified personal residence trusts, "QPRTs"), lead trusts can be created either while the donor is alive (i.
(grantor retained annuity trusts) and GRUTs (grantor retained unitrusts) are based on the fact that gift tax liability is measured by the property's value at the moment the gift becomes complete.