With the end of the year approaching, the focus of HNW and Family Office Space has turned to intergenerational planning.

One of the ideas on the minds of many families is providing for future generations.

It would be natural to make gifts to future generations to avoid the estate tax.

However, Congress figured that out and implemented the Generation Skipping Transfer Tax back in 1976.  It’s not easy to understand, implement or track especially across generations.

MICHAEL GROSSMAN is here to help us understand the GST,

Michael is Tax Manager/Fiduciary Specialist from the firm of Adelman Katz & Mond LLP (www.akmcpa.com)

He has Extensive experience working as a tax manager, fiduciary accountant and trust and estate administrator for the past 27 years and manages all aspects of ‘High Net Worth’ individuals and family tax issues.

The Background on the US Tax Regime:

What are ‘Lifetime Exemptions’

Income Tax vs Capital Gains Tax vs the Estate/Gift Tax vs GST

What is a ‘Taxable Gift’

What is a (GST) – Generation Skipping Transfer Tax?

Gift and GST – two separate lifetime exemptions

· 2022 Estate/Gift Lifetime Exemption – $12,060,000 per person ($24,120,000/couple)
· 2022 GST Lifetime exemption – $12,060,000 per person ($24,120,000/couple)

GST – gifts to an individual vs. gifts to a trust
· What is the difference between a ‘GST Trust’ and a ‘Non-GST Trust’
· What happens when gifts are allocated to GST – or not

Annual Exclusions – One size does not fit all
· Crummey Power
· Annual exclusion for ‘Gift Tax’
· Annual exclusion for ‘GST Tax’


Not including or discussing gift to a Trust in overall estate plan
· Conversations with family/trust and estate attorney

Direct vs. Indirect (GST) Gifts
· What is the difference
· Reporting difference on Gift Tax Return

Allocation of GST – Elections
· Automatic Allocation
· Opt in vs. Opt out

Annual Exclusions
· Follow up and connect to item #6 above

Best Practices:

Be clear in understanding how the trust works
· Does the gift made align with overall estate plan
· Does it accomplish your goals

Make sure you discuss current and past gifts with attorney drafting trust
· Review prior gift tax returns
· Make sure preparer of gift tax return knows what they are doing


Adelman Katz & Mond


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