generation-skipping transfer tax

Definition of "generation-skipping transfer tax"
  1. A tax applied by federal authorities on large money transfers or inheritances directed to a grandchild or great-grandchild, designed to prevent tax avoidance procedures by skipping a generation. It applies to wealth transfers exceeding an exempt amount
How to use "generation-skipping transfer tax" in a sentence
  1. The affluent couple planned their estate carefully to account for the generation-skipping transfer tax.
  2. Being aware of the generation-skipping transfer tax, the wealthy family consulted a tax advisor before proceeding with the inheritance.
  3. In order to avoid the generation-skipping transfer tax, it was essential for them to plan inheritance below the threshold.

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