Terry Nelson photo

Terry Nelson, CFP®, ChFC®, CASL, LUTCF®

 

Olmsted Financial Group

3428 Lakeridge Pl. N.W., Suite 120

Rochester, MN 55901

 

Phone:  507-281-1262

Cell:      507-250-3967

Fax:      507-281-9131

 

Email: Terry@OlmstedFinancialGroup.com

July/August 2025

GRATs: A Handy Wealth-Transfer Tool

A grantor-retained annuity trust (GRAT) is an estate strategy that may minimize tax on large financial gifts to family members and help your estate avoid using much, if any, of your lifetime gift and estate tax exclusion.


Structure
With a GRAT, you place appreciating assets into an irrevocable trust and receive an annual income from the trust for a specified period.


When the trust expires, your beneficiary receives the remaining assets with little or no gift-tax consequences to your estate. You select whether income payments will come from asset earnings or be based on a percentage of the total value of the trust assets.


Caution
Your beneficiary receives nothing, however, if you die before the GRAT expires. Instead, the assets become part of your taxable estate, negating the trust benefits. So, take care when choosing a trust period.


Professional financial and legal help is essential when considering a trust, particularly an irrevocable trust. You can't easily undo a irrevocable trust if you later change your mind or make a mistake creating it.


CONTACT US

Enter your Name, Email Address and a short message. We'll respond to you as soon as possible.

Securities and Advisory services offered through Geneos Wealth Management, Inc. Member FINRA/SIPC.
Olmsted Financial Group and LTM Marketing Specialists LLC are unrelated companies. This publication was prepared for the publication’s provider by LTM Client Marketing, an unrelated third party. Articles are not written or produced by the named representative.

The information and opinions contained in this web site are obtained from sources believed to be reliable, but their accuracy cannot be guaranteed. The publishers assume no responsibility for errors and omissions or for any damages resulting from the use of the published information. This web site is published with the understanding that it does not render legal, accounting, financial, or other professional advice. Whole or partial reproduction of this web site is forbidden without the written permission of the publisher.