{"id":5383,"date":"2023-02-06T14:10:28","date_gmt":"2023-02-06T19:10:28","guid":{"rendered":"https:\/\/www.lindabury.com\/firm\/?p=5383"},"modified":"2023-03-04T20:01:06","modified_gmt":"2023-03-05T01:01:06","slug":"the-uses-of-grantor-trusts-in-estate-planning","status":"publish","type":"post","link":"https:\/\/www.lindabury.com\/firm\/insights\/the-uses-of-grantor-trusts-in-estate-planning.html","title":{"rendered":"The Uses of Grantor Trusts in Estate Planning"},"content":{"rendered":"<p>Grantor trusts can provide substantial estate and income tax savings to those who establish them.\u00a0 The grantor of a \u201cgrantor trust\u201d is treated as the owner of the trust assets for federal income tax purposes. The grantor continues to pay the income tax generated by the assets contributed to the trust and receives the benefit of all deductions and credits. Whether the grantor trust property is excluded from the <em>estate<\/em> of the grantor, and thus escapes estate tax, is dependent on the drafting of the trust. The rules regarding grantor trusts can be found in Sections 671 through 679 of the Internal Revenue Code. <a href=\"#_edn1\" name=\"_ednref1\">[1]<\/a><\/p>\n<p>It is beneficial for the grantor to be treated as the income tax owner of a trust because trusts have more compressed tax brackets than do individuals. For example, in 2022, individuals were taxed at the highest marginal rate of 37% on income over $539,900, or $647,850 for married taxpayers.<a href=\"#_edn1\" name=\"_ednref1\">[2]<\/a> Trusts, however, reached the top marginal rate of 37% at income above $13,450.<a href=\"#_edn2\" name=\"_ednref2\">[3]<\/a><\/p>\n<p>In general, the following provisions\u00a0 in a trust will create a \u201cgrantor trust.\u201d<\/p>\n<div class=\"read_more_link\"><a href=\"https:\/\/www.lindabury.com\/firm\/insights\/the-uses-of-grantor-trusts-in-estate-planning.html\"  title=\"Continue Reading The Uses of Grantor Trusts in Estate Planning\" class=\"more-link\">Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Grantor trusts can provide substantial estate and income tax savings to those who establish them.\u00a0 The grantor of a \u201cgrantor trust\u201d is treated as the owner of the trust assets for federal income tax purposes. The grantor continues to pay the income tax generated by the assets contributed to the trust and receives the benefit [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[293,65,343],"tags":[],"coauthors":[295],"class_list":["post-5383","post","type-post","status-publish","format-standard","hentry","category-robbins","category-insights","category-wills-trusts-estates-insights"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>The Uses of Grantor Trusts in Estate Planning &#8212; February 6, 2023 &#8212; Lindabury, McCormick, Estabrook &amp; Cooper, P.C. Firm News &amp; Events<\/title>\n<meta name=\"description\" content=\"Grantor trusts can provide substantial estate and income tax savings to those who establish them.\u00a0 The grantor of a \u201cgrantor trust\u201d is treated as the\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.lindabury.com\/firm\/insights\/the-uses-of-grantor-trusts-in-estate-planning.html\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Uses of Grantor Trusts in Estate Planning &#8212; February 6, 2023 &#8212; Lindabury, McCormick, Estabrook &amp; Cooper, P.C. 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Firm News &amp; Events","article_published_time":"2023-02-06T19:10:28+00:00","article_modified_time":"2023-03-05T01:01:06+00:00","author":"Anne Marie Robbins","twitter_card":"summary_large_image","twitter_misc":{"Written by":"Anne Marie Robbins","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.lindabury.com\/firm\/insights\/the-uses-of-grantor-trusts-in-estate-planning.html#article","isPartOf":{"@id":"https:\/\/www.lindabury.com\/firm\/insights\/the-uses-of-grantor-trusts-in-estate-planning.html"},"author":{"name":"Lindabury, McCormick, Estabrook &amp; Cooper, P.C.","@id":"https:\/\/www.lindabury.com\/firm\/#\/schema\/person\/429b3bd6b52a7aa6eb9a0709bbb4d06f"},"headline":"The Uses of Grantor Trusts in Estate Planning","datePublished":"2023-02-06T19:10:28+00:00","dateModified":"2023-03-05T01:01:06+00:00","mainEntityOfPage":{"@id":"https:\/\/www.lindabury.com\/firm\/insights\/the-uses-of-grantor-trusts-in-estate-planning.html"},"wordCount":598,"articleSection":["Anne Marie Robbins","Insights","Wills, Trusts &amp; Estates"],"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/www.lindabury.com\/firm\/insights\/the-uses-of-grantor-trusts-in-estate-planning.html","url":"https:\/\/www.lindabury.com\/firm\/insights\/the-uses-of-grantor-trusts-in-estate-planning.html","name":"The Uses of Grantor Trusts in Estate Planning &#8212; February 6, 2023 &#8212; Lindabury, McCormick, Estabrook &amp; Cooper, P.C. 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