The IRS has issued final regulations concerning the types of trust changes that will not affect the trust’s exempt status for generation-skipping transfer (GST) taxes.

Generally, a trust that was irrevocable on September 25, 1985 is exempt from GST taxes unless a transfer is made from corpus added after September 25, 1985. The new regulations provide guidance with respect to the type of trust modifications that will not affect the exempt status of such a trust.

In addition, these regulations clarify the application of the effective date rules in the case of property transferred pursuant to the exercise of a general power of appointment. These regulations are necessary to provide guidance to taxpayers so that they may properly determine if chapter 13 of the Code is applicable to a particular trust.

You can access the document online at:
www.access.gpo.gov/su_docs/fedreg/a001220c.html.