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The U.S. generation-skipping transfer tax (a.k.a. "GST tax") imposes a tax on both outright gifts and transfers in trust to or for the benefit of unrelated persons who are more than 37.5 years younger than the donor or to related persons more than one generation younger than the donor, such as grandchildren. [1]
If your estate is big enough, you should know how generation-skipping transfer taxes work, and how to avoid paying more than you must.
Also called the generation-skipping tax, this federal tax … Continue reading → The post What Is the Generation-Skipping Transfer Tax? appeared first on SmartAsset Blog.
A generation-skipping trust lets you avoid that middle round of taxes. But be aware that if assets in a generation-skipping trust exceed $14 million, they may themselves be subject to taxes , of ...
Income, gift, estate, and generation-skipping transfer tax planning plays a significant role in choosing the structure and vehicles used to create an estate plan. In the United States, assets left to a spouse who is a U.S. citizen or any qualified charity are not subject to U.S. Federal estate tax.
Some states impose an inheritance tax on recipients of bequests. Gift taxes are levied on the giver (donor) of property where the property is transferred for less than adequate consideration. An additional generation-skipping transfer (GST) tax is imposed by the federal and some state governments on transfers to grandchildren (or their ...
Taxpayers who expect to have a taxable estate may sometimes prefer to pay gift taxes as they occur rather than saving them up as part of the estate. Furthermore, transfers (whether by bequest, gift, or inheritance) above $1 million may be subject to a generation-skipping transfer tax if specific other criteria are met.
Generation-skipping tax. Generation-skipping tax is another federal tax payment that may apply if you “skip” a generation in your estate plan. For example, say that instead of passing on ...