Making GRATs Great: Sophisticated Estate-Planning Strategies to Optimize Grantor Retained Annuity Trusts

Private client attorneys Lisa Presser and Brian Balduzzi co-authored an article titled “Making GRATs Great: Sophisticated Estate-Planning Strategies to Optimize Grantor Retained Annuity Trusts” for The Legal Intelligencer. 

Grantor retained annuity trusts (GRATs) are irrevocable trusts in which a grantor contributes property in exchange for the right to receive a specified amount (or property with a specified value) each year for a term of years (the annuity period). In the article, Presser and Balduzzi explain how through methods like rolling GRATs or utilizing “swap” powers, GRATs can be used to maximize estate and gift tax exemptions. 

“GRATs can be a valuable strategy for clients who may wish to transfer assets expected to appreciate in excess of the 7520 Rate to certain loved ones,” the co-authors conclud. “By incorporating sophisticated strategies, such as rolling GRATs, exercises of swap powers, transfers of LLC interests, and allocations of GST tax, clients can leverage their GRATs for optimal results for efficient and effective transfers of wealth.”