Gift In Trust

Filed Under » , , ,
Dictionary Says

Definition of 'Gift In Trust'

An indirect bequest of assets to a beneficiary by means of a special legal and fiduciary arrangement. The purpose of a gift in trust is to avoid taxes on gifts that exceed the annual gift tax exclusion amount. Gift taxes are almost always paid by the gift giver and if they exceed $13,000 in one year the excess is taxable.
Investopedia Says

Investopedia explains 'Gift In Trust'

Gift givers can give gifts in excess of the annual exclusion without paying taxes by establishing a special type of trust, such as a Crummey trust. A gift to a Crummey trust allows the beneficiary to withdraw the gift for a limited time, which makes the gift a present interest and makes it eligible for the gift tax exclusion. If the gift did not have these limited-time withdrawal rights, it would be considered a future interest and it would be subject to gift taxes. That being said, it is generally understood that the beneficiary will not actually withdraw the funds during the withdrawal period. Gifts in trust are commonly used by parents or grandparents who want to establish a trust fund for their children or grandchildren.

Articles Of Interest

  1.

    Gifting Your Retirement Assets To Charity

    There are several things to consider when it comes to this type of charitable giving. Make sure you're well informed.

  2. Top 7 Estate Planning Mistakes

    Many people try to avoid this process altogether, making things difficult for heirs.

  3. Getting Started On Your Estate Plan

    With some preparation, you can save your heirs from paying a hefty estate tax. Here are some tips.

  4. Skipping-Out on Probate Costs

    Don't let bad estate planning lead to unnecessary costs and stress for your inheritors.

  5. Can I give stock as a gift?

    Stocks, bonds or any other securities can be transferred as gifts. Giving the gift of stock also has benefits for the giver. If the stock has appreciated in value, the holder can avoid paying ...

  6. Can I donate stock to charity?

    Giving stock, instead of cash, as a donation can greatly benefit both parties. You will find that most charities, hospitals, schools and other nonprofit organizations will accept stock as a gift ...

  7. Certifications For Estate Planning

    These certifications can lead to a promising career, but is estate planning for you?

  8. Why You Shouldn't Die In 2013

    Increases in estate tax rates and possible fiscal cliff implications will make things more difficult when it comes to arrangements for your death.

  9. Tax-Efficient Wealth Transfer

    Taxpayers with large taxable estates were required to take steps to reduce them before 2011.

  10. What To Do When You're Left Out Of A Will

    Discover the legal steps you can take if you are left out of a will and if fighting is worth the effort.
comments powered by Disqus
Marketplace
Hot Definitions

  1. Zomma

    An options greek used to measure the change in gamma in relation to changes in the volatility of the underlying asset.

  2. Yield Elbow

    The point on the yield curve indicating the year in which the economy's highest interest rates occur. The yield elbow is the peak of the yield curve, signifying where the highest interest rates occurred.

  3. Xenocurrency

    A currency that trades in markets outside of its domestic borders.

  4. Wanton Disregard

    A standard of severe negligence. Wanton disregard is a very serious accusation that indicates that a person behaved extremely recklessly.

  5. Ultra ETF

    A class of exchange-traded funds (ETF) that employs leverage in an effort to achieve double the return of a set benchmark.

  6. Toehold Purchase

    A purchase of less than 5% of a target company's outstanding stockmade by an acquiring company. A toehold purchase of just under 5%, while not a significant stake in a firm, allows the shareholders a "toe-holds" grip on the company and its decision making.
Trading Center
http://sp.fastclick.net/ad/tr/10858-64082-15546-0?mpt=3f57e2a50109a2830bfb10ef5281f075