Peggy and Lenard, at their death, wish to transfer their property to their great-grandson, the only one they actually like. What will the IRS impose on the gift?

Question

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The transfer of property to someone two generations youngest then the owner will face the IRS imposing the Generation-skipping Transfer Tax (GSTT). The tax deters grandparents from passing assets to their grandchildren and thus denying the government of tax dollars for another generation. TIRS wants property in an estate to be taxed in each generation. This tax is imposed at the highest federal estate and gift taxes rate of 45 percent in 2009. The amount of gift tax depends on whether the transfer involves a direct skip, a taxable distribution.

Peggy and Lenard, at Their Death, Wish to Transfer Their