Rolling GRAT Program Saves Client Over $200 Million
Holland & Knight was the longtime counsel for a middle market company, and personal advisor to the CEO and his three brothers for 30 years. The company's assets included, among other things, 12,000 titled pieces of tangible property and over 190 leases of real estate throughout the United States and Canada. A number of our Private Wealth lawyers, with the assistance of numerous Business and Real Estate attorneys throughout the firm, represented the company when it sold these assets to a large Fortune 500 company, retaining numerous other assets in the family holding company. Because the Private Wealth group had been working on the estate planning for all family members for more than a dozen years, using a wealth transfer technique known as a “rolling GRAT program,” over 60 percent of the value of the sale was transferred to the next generation with only minimal gift taxes. In addition, we met with each of the family shareholders to create new GRATs that would shift significant additional amounts of appreciation on a tax-free basis. All in all, the transfer tax savings from this approach exceeded $200 million. We also used other techniques for several of the family to avoid almost $5 million of state income taxes on the transaction.
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