JOURNAL ARTICLE

Estates, Trusts & Gifts.

  • Published In: Tax Adviser, 2026, v. 57, n. 5. P. 16 1 of 3

  • Database: Business Source Ultimate 2 of 3

  • Authored By: Salgat, Alexander 3 of 3

Abstract

The article focuses on advanced estate and tax planning strategies involving intentionally defective grantor trusts (IDGTs) and generation-skipping transfer (GST) tax planning to preserve multigenerational wealth. It explains that the GST tax is a 40% federal tax on transfers to “skip persons” (descendants two or more generations below the transferor) and highlights the importance of fully utilizing the separate GST exemption, which is not portable between spouses. The use of dynasty trusts in states with extended or abolished rule against perpetuities (RAP) allows assets to grow and be distributed across many generations free from estate and GST taxes. IDGTs enable grantors to pay income tax on trust earnings, reducing the taxable estate while allowing trust assets to appreciate outside the estate. The article emphasizes the need for coordinated planning among legal, tax, and financial professionals to navigate complex rules and optimize long-term wealth transfer outcomes. [Extracted from the article]

Additional Information

  • Source:Tax Adviser. 2026/05, Vol. 57, Issue 5, p16
  • Document Type:Article
  • Subject Area:History
  • Publication Date:2026
  • ISSN:0039-9957
  • Accession Number:193470683
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