Incomplete Non-Grantor Trust

An Incomplete Non-Grantor Trust (“ING”) is a powerful vehicle, particularly for low cost basis assets with a contemplated future sale, that potentially eliminates state income/capital gain tax while taking advantage of Domestic Asset Protection and other progressive modern trust laws. It is an incomplete gift that never leaves the settlor’s estate, which means there is no gift tax. In addition, the trust has a Non-Grantor status, meaning the income is taxed at the trust level, not the individual level, thereby potentially avoiding state income tax on assets within a trust if sitused and properly administered in a no-tax jurisdiction.

Watch this video to learn when to use the ING and to hear more about other state tax planning opportunities that exist by simply creating or moving a trust to a no-tax jurisdiction like South Dakota.

For more information on INGs and how this tax planning strategy can work in your favor, please reach out to us via our contact page.