Generation-Skipping Transfer Tax Basics

If your estate is big enough, you should know how generation-skipping transfer taxes work, and how to avoid paying more than you must.

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(Image credit: Getty Images)

If you have ever sought the advice of an estate planning professional, you’ve probably heard of the generation-skipping transfer tax (GSTT). It is likely that you and your descendants will not be subjected to this tax — either due to the $11.7 million per person gift tax, federal estate tax and GSTT lifetime exemption or because of planning that subjects trust property to estate tax inclusion in the lower generations to avoid the GSTT. But I am getting ahead of myself.

What is the Generation-Skipping Transfer Tax?

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Timothy Barrett, Trust Counsel
Senior Vice President, Argent Trust Company

Timothy Barrett is a Senior Vice President and Trust Counsel with Argent Trust Company. Timothy is a graduate of the Louis D. Brandeis School of Law, past Officer of the Metro Louisville Estate Planning Council and the Estate Planning Council of Southern Indiana, Member of the Louisville, Kentucky, and Indiana Bar Associations, and the University of Kentucky Estate Planning Institute Committee.