Maintaining GST Status Despite Trust Modifications

Do proposed changes cause the loss of a grandfathered generation-skipping transfer tax classification?

In Private Letter Ruling 201341005 (Oct. 11, 2013), the Internal Revenue Service addressed a taxpayer’s concern about whether proposed modifications to five trusts would: 1) cause them to lose their grandfathered status for generation-skipping transfer (GST) tax purposes, and 2) cause a distribution or termination of any interest in the trusts to be subject to GST tax.  The IRS concluded that the modifications wouldn’t cause the trusts to lose their grandfathered status fo

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