Allocating the GST Exemption Under the Generation-Skipping Transfer TaxMaine L. Rev. (1989)
AbstractOne of the most significant aspects of the Tax Reform Act of 1986 for estate planners was the retroactive repeal of the original 1976 generation-skipping transfer (GST) tax and the enactment of an entirely new generation-skipping transfer tax. The new generation-skipping transfer tax, unlike the 1976 version, generally applies to transfers that constitute "direct skips," such as outright gifts to grandchildren. Like the earlier tax, the new tax also applies to "taxable terminations," such as a termination of the life estate of the transferor's child resulting in the grandchild receiving possession of the transferred property in fee simple under the terms of the original transfer, and "taxable distributions," such as a discretionary distribution to a grandchild from a trust created for the benefit of the transferor's children and grandchildren. It is notable, however, that the taxable event (referred to in the statute as the "generation-skipping transfer") is the transfer of the property by the transferor in the case of a direct skip, while the taxable event in the case of a taxable termination or a taxable distribution will usually occur long after the initial transfer of property by the transferor.
Citation InformationMichael B. Lang. "Allocating the GST Exemption Under the Generation-Skipping Transfer Tax" Maine L. Rev. Vol. 41 (1989)
Available at: http://works.bepress.com/michael_lang/7/