Could GRATs Lose Their Tax Magic?

Estimated wealth Sheldon Edelson has given his heirs using more than 30 GRATs

Estimated federal gift tax Edelson has saved by using GRATs

Grantor Retained Annuity Trusts have certainly drawn Bloomberg's attention. (Check out the video.) And GRATs again receive attention in the President's budget proposal, as Deborah Jacobs reports. Unlike the pro forma call for a return to harsher estate taxation, the proposed crackdown on GRATs, Crummey trusts and dynasty trusts shouldn't be dismissed, Jacobs believes.

Don’t expect thoughtful estate tax reform — we’re talking congressional horsetrading, perhaps done incrementally. (Heads up: watch those transportation funding bills.)

Richard Covey, the father of high-speed GRATs, estimates his brainchild has saved donors more than $100 billion in taxes since 2000. Could the end be nigh?