Modest net worth individuals need to balance their desire to make lifetime gifts with the need to maintain adequate funds to support their future. For married couples, a spousal lifetime access trust (SLAT) provides a solution. One spouse (donor-spouse) places assets into an irrevocable trust using their gift tax exemption. The SLAT names the non-donor spouse (beneficiary-spouse) as the beneficiary, allowing the trustee to make distributions to the beneficiary-spouse during life. SLATs provide several benefits, including the ability of the trust to benefit multiple generations without incurring additional estate or generation-skipping transfer taxes.
See Spousal Lifetime Access Trusts (SLATs), Lexology, August 3, 2016.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
