A grantor retained annuity trust is a wealth preservation tool that can be used by high net worth people who are exposed to the federal estate tax when certain circumstances exist. Before we get into the details, we should take a look at some relevant information about the federal estate tax and the gift tax.
The federal estate tax carries a 40 percent maximum rate, and this is quite a large number, especially when you consider the fact that your estate is comprised of assets that you have left after paying taxes all of your life. Many people think that the estate tax is excessive and unfair, but regardless of how you may feel about the tax, it is a fact of life.
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Timothy P. Murphy is an estate planning and elder law attorney whose practice emphasizes helping people to build, preserve and pass on their wealth. He works with his clients to accomplish their goals while avoiding unnecessary court proceedings and minimizing or eliminating exposure to death taxes.
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