Estate of Eleanor R. Gerson, Deceased, Allan D. Kleinman, Executor - Page 7

                                        - 7 -                                         
          I.  The Generation-Skipping Transfer Tax                                    
               The current version of the GST tax, set forth in sections              
          2601-2664, was enacted under TRA 1986, in which Congress                    
          substantively modified and retroactively repealed an earlier GST            
          tax regime enacted in 1976.2  The GST tax generally is imposed on           
          transfers, whether outright or in trust, to transferees who are             
          at least two generations below the generation of the transferor.            
          Secs. 2611, 2613(a).  The public policy underlying the GST tax is           
          to bring uniformity and consistency to Federal transfer taxes               
          (estate, gift, and generation-skipping) by imposing a transfer              
          tax upon all transfers whether directly to an immediate                     
          succeeding generation or to generations further removed from the            
          transferor.  See Peterson Marital Trust v. Commissioner, 78 F.3d            
          795, 798 (2d Cir. 1996), affg. 102 T.C. 790 (1994); H. Rept. 99-            
          426, at 824, 1986-3 C.B. (Vol. 2) 1, 824.                                   
               A generation-skipping transfer is defined to include a                 
          taxable distribution, a taxable termination, and a direct skip.             
          Sec. 2611(a).  A direct skip means a transfer, subject to Federal           
          estate or gift tax, of an interest in property to a skip person.            
          Sec. 2612(c)(1).  A skip person means a natural person assigned             
          to a generation which is two or more generations below the                  
          generation of the transferor, or a trust if all interests in such           


               2  The first generation-skipping transfer tax was enacted as           
          part of the Tax Reform Act of 1976, Pub. L. 94-455, sec. 2006, 90           
          Stat. 1879-1890.                                                            




Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  Next

Last modified: May 25, 2011