Sales to Intentional Grantor Trusts
|November 2, 2012|
Previously published on October 2012
Sales to Intentional Grantor Trusts (IGTs) (sometimes also referred to as "intentionally defective grantor trusts") are an effective estate planning strategy to remove assets from the estate of the senior generation while preserving an income stream from the sale. An IGT is an irrevocable trust that removes assets from the grantor’s taxable estate. This strategy "freezes" the estate of the senior generation by converting appreciating assets into a non-appreciating asset with a fixed yield. The strategy takes advantage of the differences between the estate tax inclusion rules and the separate grantor trust income rules under the Internal Revenue Code ("Code").
The views expressed in this document are solely the views of the author and not Martindale-Hubbell. This document is intended for informational purposes only and is not legal advice or a substitute for consultation with a licensed legal professional in a particular case or circumstance.
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