What is the purpose of grantor retained income trusts (GRIT)?

Question

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The purpose of grantor retained income trusts (GRIT) is to avoid paying estate tax, but not gift tax. This is done by leveraging the applicable exclusion amount. The value of the gift made is calculated by taking the FMV of the property and reducing it by the retained interest. This equals the remainder interest that is considered a gift. This remainder interest is a future interest and is discounted. Therefore, the longer the term of the trust and the higher the Section 7520 rate, the smaller the gift value The result is to freeze the value in the grantor's interest sand transfer growth in value to the children escaping larger gift and estate tax.

What Is the Purpose of Grantor Retained Income Trusts (GRIT)