What is the generation-skipping transfer tax?
The generation-skipping transfer tax, or GST tax, is an additional wealth transfer tax in addition to the estate tax and gift tax, and it’s a flat 40 cents on every dollar going down to a skipped generation. A skipped generation is defined as any generation that is two generations below your generation, so a grandchild or below. It’s a pretty onerous tax. It’s an additional 40 cents on every dollar going down to a grandchild. So proper planning really must be done to make certain that you don’t ever get hit with the generation-skipping tax. Have more questions about the generation-skipping transfer tax? Then contact us today to schedule a free consultation! Doane & Doane – Top rated Tax & Estate Planning Attorneys