The Version of The Tax Starting in 1986
That approach posed so many administrative problems that in 1986 Congress repealed the 1976 version and enacted a new generation-skipping transfer tax law.
The most recent version of the generation-skipping tax, applicable to estate or gift transfers through December 31, 2009, did not attempt to impose a tax equal to the estate or gift tax that was avoided. Instead, the generation-skipping tax was imposed at a flat rate equal to the highest marginal estate and gift bracket applicable at the time of the gift, bequest, transfer or termination. In 2009, that rate was currently 45%.
In 2009, each taxpayer currently possessed a $3,500,000 exemption from the generation-skipping tax. That meant that only aggregate gifts and bequests to grandchildren or younger beneficiaries in excess of $3,500,000 (potentially $7,000,000 for a married couple acting in concert) would be subject to the generation-skipping transfer tax.
In 2010, like the Federal Estate Tax, the generation-skipping transfer tax was repealed. In some ways, it could be viewed that the exemption is essentially unlimited in 2010 for transfers that would otherwise be subject to the tax. However, the law that created the increases and ultimate repeal of the GST Tax Exemption, expired on December 31, 2010.
For generation-skipping trusts created in the years of 2011 and 2012 and for outright gifts to skip-persons, taxpayers are entitled to a $5 million GST tax exemption.
Read more about this topic: Generation-skipping Transfer Tax
Famous quotes containing the words version, tax and/or starting:
“Truth cannot be defined or tested by agreement with ‘the world’; for not only do truths differ for different worlds but the nature of agreement between a world apart from it is notoriously nebulous. Rather—speaking loosely and without trying to answer either Pilate’s question or Tarski’s—a version is to be taken to be true when it offends no unyielding beliefs and none of its own precepts.”
—Nelson Goodman (b. 1906)
“I have no doubt that it was a principle they fought for, as much as our ancestors, and not to avoid a three-penny tax on their tea; and the results of this battle will be as important and memorable to those whom it concerns as those of the battle of Bunker Hill, at least.”
—Henry David Thoreau (1817–1862)
“It smells like gangrene starting in a mildewed silo; it tastes like the wrath to come, and when you absorb a deep swig of it you have all the sensations of having swallowed a lighted kerosene lamp.”
—For the State of Kentucky, U.S. public relief program (1935-1943)