Gifts by Business Owners: Great to GRAT & IDing When To IDGT

Private client attorneys Lisa Presser and Brian Balduzzi participated in a webinar for the New Jersey State Bar Association on estate planning strategies used by high-net-worth clients. 

They discussed both Grantor Retained Annuity Trust (GRAT) and Intentionally Defective Grantor Trust (IDGT), two popular vehicles for transferring future appreciation in the value of closely held business interests to an owner’s loved ones. 

During the webinar, Presser and Balduzzi reviewed the common options for structuring a GRAT and identify some of the pitfalls, and pose solutions, for closely held business owners; differentiated the value of an IDGT and explained potential planning for closely held business interests; and discussed and emphasized some of the gift tax reporting and disclosure requirements for such transfers.