S. 3988 · 118th Congress
GRATS Act
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Never voted on. It didn't reach a floor vote before the 118th Congress ended, so it expired. A bill has to be introduced again to be considered in a new Congress.
D
WydenSponsor1 cosponsor · 1 I
1 signed on when it was introduced; the rest joined later. Cosponsors who withdrew aren't shown.
This bill imposes new requirements on grantor retained annuity trusts (GRATs) to discourage tax avoidance schemes by wealthy taxpayers. Specifically, such trusts must have a minimum term of 15 years and a maximum term of the life expectancy of the annuitant plus 10 years.
What it does: CRS summary · Introduced in Senate · Mar 20, 2024
Getting Rid of Abusive Trust Schemes Act or the GRATS Act
This bill imposes new requirements on grantor retained annuity trusts (GRATs) to discourage tax avoidance schemes by wealthy taxpayers. Specifically, such trusts must have a minimum term of 15 years and a maximum term of the life expectancy of the annuitant plus 10 years. The bill also prohibits any decrease in a GRAT during its term and requires that the remainder interests in such trusts at the time of their transfer must have a minimum value for gift tax purposes.
The bill also treats a transfer of property between a GRAT and its deemed owner as a sale or exchange for income tax purposes, with specified exceptions.
The bill designates any income tax paid on the income of a GRAT as a gift for purposes of the gift tax unless the owner of the trust is reimbursed during the same calendar year. The amount of the gift may not be reduced through the use of certain deductions, including the charitable or marital deduction, or gifts of tuition or medical care.
Written by the nonpartisan Congressional Research Service. All summary versions on Congress.gov
About this bill and sources
Official title: GRATS Act
Also known as: Getting Rid of Abusive Trust Schemes Act
Latest action (Mar 20, 2024): Read twice and referred to the Committee on Finance.
Policy area: Taxation · Origin: Senate · Introduced: Mar 20, 2024
Official page on Congress.gov · Bill text (GovInfo) · Status record (XML)
No recorded floor vote found.