Reporting GRATS, GRUTS, ILITS and IDGTs on Form 709: GST Exemption Allocation Calculations and Strategies

Clients who have utilized planning vehicles such as IDGTs, GRATs, ILITs or decanted trusts face complex considerations in preparing Form 709 Gift Tax Returns, especially in terms of allocating generation-skipping transfer tax exemptions. Any transfer of assets directly to a “skip person,” or to a trust for the benefit of a skip person, triggers GST reporting and allocation requirements.

Transfers to trusts involving skip persons requires the tax adviser to calculate the exemption allocations for GST purposes on Form 709. Advisers must have a thorough grasp of the rules governing automatic allocations, “ETIP allocations,” and timely vs. late allocations, as well as the calculation methodologies for dealing with more sophisticated trusts.

Listen as our experienced panel provides practical guidance on calculating and reporting required allocations, as well as planning opportunities to reduce GST tax impact on IDGTs, GRATs, ILITs and meeting adequate disclosure requirements.

1. Identifying taxable transfers to skip persons subject to GST reporting in trust documents
2. GRAT and Crummey Trust exemption allocation and reporting
3. IDGT seed gift and sale basics and reporting
4. ETIP rules and GST exemption allocation calculations
5. The adequate disclosure rules

The panel will discuss these and other important topics:

• Opting out of automatic allocation of GST exemptions—when and how
• Reporting indirect skips
• Late allocations of GST exemptions
• Calculating inclusion ratio
• Avoiding ETIP traps

Learning Objectives

After completing this course, you will be able to:

• Identify taxable transfers to skip persons
• Determine whether a late allocation of GST exemption would provide a more favorable tax outcome
• Recognize correct GST exemption amounts for IDGTs, GRATs, ILITs and Crummey Trusts
• Distinguish GST exemption on ILIT premiums to avoid GST on life insurance benefits

• Field of Study: Taxes
• Level of Knowledge: Intermediate
• Advance Preparation: None
• Teaching Method: Seminar/Lecture
• Delivery Method: Group-Internet (via computer)
• Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
• Prerequisite:

  Three years+ business or public firm experience at mid-level within the organization preparing complex tax forms and schedules. Specific knowledge of estate planning, gifts, trusts, GRATs, GRUTs, ILITs and IDGTs and IRS Form 709; familiarity with exemption calculations, generation skipping taxes and portability of spousal lifetime exclusions.

Strafford Publications, Inc. is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).