IRS PLR: Trust Won’t Lose Its Exempt Status for Generation-Skipping Transfer Tax Purposes (IRC §2601)

The IRS has published a private letter ruling on Section 2601, concluding that the state court’s construction of the trust provisions and modification dividing the trust into separate trusts will not cause the trusts to lose their exempt status from the generation-skipping transfer (GST) tax, provided no additions were made after Sept. 25, 1985. The ruling applies to Form 706 for the estate tax and Form 709 for gift tax returns for applicable taxable years. [PLR 202538016]

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