IRS Issues PLR Confirming Grandfathered Trust Changes Preserve GST Exemption, Avoid Gifts

The IRS has published a private letter ruling on I.R.C. §§2033, 2035, 2036, 2037, 2038, 2041, 2501, 2511, 2512, 2601, 2611, 2612, 2651, and 2652 and Treas. Regs. §§20.2038, 20.2041, 25.2511, and 26.2601 modifying trust terms confirming that court approved changes to an irrevocable trust created before September 25, 1985, including granting testamentary general powers of appointment to issue beneficiaries and creating separate issue trusts, will not cause loss of generation-skipping transfer (GST) tax exempt status, inclusion in the grantor’s gross estate, or constitute taxable gifts to any party where the modifications do not shift beneficial interests to lower generation ...