The GST tax exemption – A tool to generate future tax savings

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Abstract: The generation-skipping transfer (GST) tax can have harsh consequences. Those who take full advantage of GST planning strategies, however, have an opportunity to shield their wealth from tax and build a lasting legacy. This article discusses three types of transfers that may trigger GST taxes, and illustrates strategies to allocate the GST tax exemption in a manner designed to produce the greatest tax savings. A sidebar shows why automatic-allocation rules regarding the exemption don’t always work in a taxpayer’s best interest.