Rolling or Selling Grantor Retained Income Trusts for Estate Planning

Gallo, Jon
December 2005
Journal of Financial Planning;Dec2005, Vol. 18 Issue 12, p26
Academic Journal
This article examines the Internal Revenue Code Section 2702 which establishes the general rule that the value of the grantor's retained term interest has no value if the remainder beneficiary is a member of the transferor's family. When valuation discounts permit a significant increase in the cash flow produced by the transferred asset relative to the asset's discounted value, a grantor retained annuity trusts and a grantor retained unitrust trust should be employed. There is also the possibility that the Internal Revenue Service might try to assert that Section 2702 is applicable to the sale.


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