Wills and Trusts

Wyatt, Tarrant & Combs, LLP


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State Reformation to Update Provisions Left Over From the Original GST Did Not Create New GST Problems

In PLR 201322025 a decedent’s GST trust called for a distribution of $250,000 to a son’s trust, a number tied to the GST in effect before 1986. The trust contained a provision to update the $250,000 amount if the Code changed. When the decedent died in 1987 the executor exempted all of the assets from GST and now the trustee has obtained a court order to distribute all of the assets to the son’s trust. The IRS determined there were no adverse GST, gift, or estate tax consequences.

Turney P. Berry
Louisville, Kentucky


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Conversion to Unitrust Did Not Affect GST Tax Grandfathered Status

In PLR 201320009 the place of administration of a trust had been moved from one state to another. However, the court order granting the move provided that the law of the original state would govern the validity and construction of the trust. When the trustee wanted to convert the distribution provisions to a unitrust, it applied the law of the original state, which had adopted a unitrust statute.

Moving the place of administration without changing the governing law, as here, is often helpful to ensure no inadvertent change that might affect a grandfathered trust.

Turney P. Berry
Louisville, Kentucky