Changes In Law Affecting The Federal Generation Skipping Transfer Tax (GST)
- Topics:
- Commercial Litigation
- Tags:
- Exemption,
- Federal Tax Code,
- Finance,
- Financial Planning,
- Free Trade,
- GST,
- Kabala & Geeseman,
- Taxes
- Source:
- Kabala & Geeseman
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Overview: The Federal Tax Code includes a tax on transfers of assets, either during lifetime or at death, to individuals who are more than one generation below the generation of the transferor or decedent. Examples of transfers, which are subject to the GST, include gifts to grandchildren above a certain amount, and transfers to grandchildren, great-grandchildren, etc., from trust funds established either by will or by trust agreements. In order to make the best use of the GST exemption, a transferor or a transferor’s executor has the power to allocate the GST exemption in a manner, which will produce the optimum tax savings. The rules governing the generation skipping tax and the allocation of the GST exemption are complicated and, for the most part, illogical. The tax itself is cumbersome and filled with traps for the unwary, therefore, one recommend that the estate plan be reviewed at least every five years.
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Format: PDF | Size: 68KB | Date: May 2002 | Pages: 2
