What is a generation-skipping trust?

A generation-skipping trust is a type of trust created in Florida to pass assets directly to grandchildren or more remote descendants of a grantor without being subject to estate or gift taxes for each generation in between. These trusts must meet specific criteria in order to be classified as generation-skipping trusts, including having a maximum duration of more than 90 years. Generation-skipping trusts are most often used when the grantor’s estate is large enough to be subject to estate and/or gift taxes. With this trust, the grantor can transfer assets to their grandchildren or more remote descendants without incurring taxes at both the estate and gift tax levels. These trusts can also be used to protect assets from creditors or potential future lawsuits. In Florida, the assets held in the trust generally can avoid probate, and this type of trust allows the grantor to control the management and distribution of assets to their grandchildren or descendants. The trust also ensures that the grantor’s wishes for the assets are followed after the transfer is complete. Generation-skipping trusts are complicated instruments, and require specialized legal advice to properly establish and administer. It is important to speak with a qualified legal professional in order to ensure that a generation-skipping trust is properly established and maintained in order to provide the desired benefits.

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What is a generation-skipping trust?

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