Grantor Retained UniTrusts
A grantor retained unitrust (GRUT) is another irrevocable trust where the grantor retains the right to receive funds annually from the trust based on a fixed percentage that is recalculated annually based on the new value of the trust. The grantor transfers property into the trust in exchange for a "variable annuity" type payout feature where the annual income stream will vary from year-to-year, depending on the value of the trust.

Characteristics of a GRUT:
- The grantor can make the initial gift and additional gifts to the trust.
- An excellent way to remove property from an estate utilizing the gift tax exclusion amounts.
- Provides a variable income stream to the grantor for a set number of years or for life.
- When the term of the GRUT ends, the remaining assets are transferred tax-free to the named beneficiaries.
- If the grantor does not out live the term of the trust, all of the property is brought back into the grantor's estate.



Qualified Personal Residence Trusts

Related Articles
  1. Managing Wealth

    Pick The Perfect Trust

    Trusts are an estate plan's anchor, but the terminology can be confusing. We cut through the clutter.
  2. Managing Wealth

    How To Set Up A Trust Fund If You’re Not Rich

    Contrary to popular opinion, trust funds are not just for the rich. Middle class citizens can set them up, as well.
  3. Managing Wealth

    Understanding Revocable Trusts

    A revocable trust is a legal arrangement whereby a grantor transfers property to a trustee who holds the property in trust for the grantor’s benefit.
  4. Financial Advisor

    Advisors: Tips for When to Employ Living Trusts

    Revocable living trusts accomplish estate planning objectives that aren't possible with a will. Here are some of the cases that show when to use a trust.
  5. Retirement

    7 Reasons To Own Life Insurance in an Irrevocable Trust

    An Irrevocable Life Insurance Trust helps minimize estate and gift taxes, provides creditor protection and protects government benefits.
  6. Investing

    A Look Into Creating a Trust Fund With ETFs (VCIT, SDIV)

    Learn the basics of how a trust works and the two most common types. Discover how to use ETFs to fund a trust and the different strategies.
  7. Financial Advisor

    A Guide to Grantor Retained Annuity Trusts

    An in depth look at Grantor Retained Annuity Trusts, how they work and who they are best suited for.
  8. Managing Wealth

    Special Trusts For Special Needs

    If you or someone you love has a disability, these trusts can help ease the cost of care.
Frequently Asked Questions
  1. What is the formula for calculating compound annual growth rate (CAGR) in Excel?

    The concept of CAGR is relatively straightforward and requires only three primary inputs: an investments beginning value, ...
  2. How do you calculate return on equity (ROE)?

    Return on equity (ROE) is a ratio that provides investors with insight into how efficiently a company (or more specifically, ...
  3. What is the difference between Communism and Socialism?

    Learn how some countries are incorporating socialist methods into capitalism.
  4. What's the difference between a stop and a limit order?

    A limit order is an order that sets the maximum or minimum at which you are willing to buy or sell a particular stock. With ...
Trading Center