3 Generation-Skipping Transfer Tax (GSTT)

U.S. Tax Law Essentials · 4:24

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Lyrics

[Verse 1]
When grandpa wants to give to grandchild dear
But skip the middle generation here
The government steps in with a special tax
To close this loophole, fill the revenue cracks
Skip persons are the key to understand
Grandchildren, great-grands, not in the middle band

[Chorus]
GSTT, Generation-Skipping Transfer Tax
Direct skips, distributions, terminations are the facts
Same exemption as estate and gift combined
Allocation and inclusion ratio intertwined
Dynasty trusts can leverage what you've got
GSTT planning, forget it not

[Verse 2]
Direct skip happens when you give straight through
From grandparent to grandchild, skipping two
Taxable distributions from a trust that pays
To skip persons in those generous ways
Taxable terminations when interests end
And skip persons are next to receive and spend

[Chorus]
GSTT, Generation-Skipping Transfer Tax
Direct skips, distributions, terminations are the facts
Same exemption as estate and gift combined
Allocation and inclusion ratio intertwined
Dynasty trusts can leverage what you've got
GSTT planning, forget it not

[Bridge]
Twelve point nine million is your shield today
Same as estate and gift exemption's way
Allocate it wisely to your trusts with care
Inclusion ratio shows how much is there
Zero means exempt, one means fully taxed
Dynasty trusts keep wealth intact

[Verse 3]
Dynasty trusts can last for generations long
With GST exemption allocated strong
Include non-skip persons as beneficiaries too
To minimize the tax that's coming due
Plan ahead, allocate, and make it last
Wealth preservation, unsurpassed

[Chorus]
GSTT, Generation-Skipping Transfer Tax
Direct skips, distributions, terminations are the facts
Same exemption as estate and gift combined
Allocation and inclusion ratio intertwined
Dynasty trusts can leverage what you've got
GSTT planning, forget it not

[Outro]
Skip the generations, pay the price
Unless you plan and think twice
GSTT keeps wealth in line
Generation-skipping by design

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