GST transfer scope: It applies to property passing two or more generations below the grantor.

GST transfer scope: It applies to property passing two or more generations below the grantor.

• A. It applies to property passing to a spouse of the grantor.
• B. It applies to property passing two or more generations below the grantor.
• C. It applies to any transfer regardless of generation.
• D. It applies only to lifetime transfers.

Answer: (B)

GST transfer scope concerns transfers that skip a generation—property passing to individuals two or more generations below the grantor. This is what defines a skip person and triggers the GST tax (subject to exemptions). Transfers to a spouse or to children (one generation below) do not skip a generation, so they aren’t GST transfers. Also, GST can apply to both lifetime gifts and transfers at death, not only lifetime transfers. So property passing two or more generations below the grantor clearly falls within the GST transfer scope.

GST transfer scope concerns transfers that skip a generation—property passing to individuals two or more generations below the grantor. This is what defines a skip person and triggers the GST tax (subject to exemptions). Transfers to a spouse or to children (one generation below) do not skip a generation, so they aren’t GST transfers. Also, GST can apply to both lifetime gifts and transfers at death, not only lifetime transfers. So property passing two or more generations below the grantor clearly falls within the GST transfer scope.