Rhode Island Grantor Retained Annuity Trust

• Category: Trusts - Misc.
• State: Multi-State
• Control #: US-13197BG
• Format: Word; Rich Text

Description

This form is used for a grantor retained annuity trust. Rhode Island Granter Retained Annuity Trust (GREAT) is a legal instrument used for estate planning in Rhode Island. It is a type of irrevocable trust that allows the granter to transfer assets into the trust while retaining an annuity interest for a defined period. The main purpose of a Rhode Island GREAT is to minimize estate taxes and transfer wealth to beneficiaries, typically family members, in a tax-efficient manner. Keywords: Rhode Island, Granter Retained Annuity Trust, GREAT, estate planning, irrevocable trust, annuity interest, minimize estate taxes, transfer wealth, tax-efficient, beneficiaries, family members. There are different types of Rhode Island Granter Retained Annuity Trusts: 1. Standard GREAT: This is the most common type of GREAT in which the granter sets a fixed annuity amount to be received annually for a predetermined period. At the end of the term, any appreciation in the trust assets above the annuity amount passes to the beneficiaries free of gift tax. 2. Zeroed-Out GREAT: In a zeroed-out GREAT, the annuity payments are set in such a way that the present value of the retained annuity equals the fair market value of the assets transferred into the trust. This ensures that no taxable gift is made when establishing the GREAT, making it an effective tool for transferring assets with minimal or no gift tax consequences. 3. Rolling GREAT: A rolling GREAT allows for the creation of a series of Grants. When the annuity term ends, instead of distributing the trust assets to beneficiaries, they are transferred into a new GREAT. This strategy can be used to further leverage the tax benefits of Grants, providing potential estate tax savings over multiple generations. 4. Charitable GREAT (Charitable Remainder Annuity Trust): In this type of GREAT, a charitable organization is named as the remainder beneficiary. The granter receives annuity payments for a specific term, and at the end of the term, the remaining trust assets pass to the designated charity. Benefiting from potential income tax deductions and the reduction of estate taxes, this type of GREAT allows individuals to support charitable causes while potentially minimizing their tax liability. Rhode Island Granter Retained Annuity Trusts are valuable estate planning tools that provide flexibility and potential tax benefits for granters in Rhode Island. Consulting with an experienced estate planning attorney can help individuals understand the specific legal requirements and implications of using a GREAT in Rhode Island.

Rhode Island Granter Retained Annuity Trust (GREAT) is a legal instrument used for estate planning in Rhode Island. It is a type of irrevocable trust that allows the granter to transfer assets into the trust while retaining an annuity interest for a defined period. The main purpose of a Rhode Island GREAT is to minimize estate taxes and transfer wealth to beneficiaries, typically family members, in a tax-efficient manner. Keywords: Rhode Island, Granter Retained Annuity Trust, GREAT, estate planning, irrevocable trust, annuity interest, minimize estate taxes, transfer wealth, tax-efficient, beneficiaries, family members. There are different types of Rhode Island Granter Retained Annuity Trusts: 1. Standard GREAT: This is the most common type of GREAT in which the granter sets a fixed annuity amount to be received annually for a predetermined period. At the end of the term, any appreciation in the trust assets above the annuity amount passes to the beneficiaries free of gift tax. 2. Zeroed-Out GREAT: In a zeroed-out GREAT, the annuity payments are set in such a way that the present value of the retained annuity equals the fair market value of the assets transferred into the trust. This ensures that no taxable gift is made when establishing the GREAT, making it an effective tool for transferring assets with minimal or no gift tax consequences. 3. Rolling GREAT: A rolling GREAT allows for the creation of a series of Grants. When the annuity term ends, instead of distributing the trust assets to beneficiaries, they are transferred into a new GREAT. This strategy can be used to further leverage the tax benefits of Grants, providing potential estate tax savings over multiple generations. 4. Charitable GREAT (Charitable Remainder Annuity Trust): In this type of GREAT, a charitable organization is named as the remainder beneficiary. The granter receives annuity payments for a specific term, and at the end of the term, the remaining trust assets pass to the designated charity. Benefiting from potential income tax deductions and the reduction of estate taxes, this type of GREAT allows individuals to support charitable causes while potentially minimizing their tax liability. Rhode Island Granter Retained Annuity Trusts are valuable estate planning tools that provide flexibility and potential tax benefits for granters in Rhode Island. Consulting with an experienced estate planning attorney can help individuals understand the specific legal requirements and implications of using a GREAT in Rhode Island.