Transfer taxes, such as the estate, gift, and generation-skipping transfer tax, create a drag on the accumulation of wealth over a family's generations. However, with the One Big Beautiful Bill's continuation of the high gift and estate tax exclusion amounts for the foreseeable future, advisers have the opportunity to create trusts that extend through the grandchildren's generation. This course examines the generation-skipping transfer (GST) tax and how it is designed to discourage avoidance of the estate and gift tax by families. Randy Gardner explores: GST tax terminology, how the GST tax is calculated, ways to avoid the GST tax, and how to design a dynasty trust to pass property from generation to generation.
Learning Objectives
• Review the purpose of the GST tax, its limitations, and the planning opportunities
• Determine how the GST tax is calculated and how it relates to the estate and gift tax
• Recognize language in estate planning documents that warrants allocation of the GST tax exemption and making the Reverse QTIP election
• Identify opportunities to establish Dynasty Trusts to possibly avoid transfer taxes for generations to come
Major Topics
• Calculation of the GST tax, and how it relates to the estate tax and gift tax
• Direct skips, taxable distributions, and taxable terminations
• GST tax allocations, Reverse QTIP election, and Exempt and Nonexempt Trusts
• Calculating the benefit of and designing Dynasty Trusts
