For example, a transfer of property from a grandparent to a grandchild would be subject to the generation skipping transfer tax. In addition, a transfer from one person to an unrelated person who is 37 1/2 years or more younger than the person making the transfer is subject to the generation skipping transfer tax.
In 2009 the federal government exempted transfers of up to $3,500,000 from the generation skipping transfer tax, but the tax was repealed on January 1, 2010, only to reappear on January 1, 2011, with a $5,000,000 exemption. For years 2012 and beyond, the exemption will be indexed for inflation, so the 2012 exemption was $5,120,000 and the 2013 exemption is $5,250,000. Some states also assess a generation skipping transfer tax.
Refer to Exemption From Federal Generation Skipping Transfer Taxes: 1997 - 2013 for a chart that shows how the generation skipping transfer tax exemption has changed over the years.
Other Terms Beginning With G