Estates and Trusts Commons^™

A Malthusian Analysis Of The So-Called Dynasty Trust, William J. Turnier, Jeffrey L. Harrison

Jeffrey L Harrison

Select financial institutions and members of the Bar have seized upon the presence of the limited exemption from the generation skipping transfer tax provided under the Internal Revenue Code to promote so-called dynasty trusts as a means whereby individuals can build dynastic wealth for a family forever free from transfer taxes. To realize such benefits, state law that does not impose the Rule Against Perpetuities must govern the trust. The promise of dynastic wealth is unlikely to be realized due to several factors. Administrative and tax costs are likely to reduce the yield on such trusts to a level where …