The Forever Vault: Dynasty Trusts & GSTT Mastery
The Forever Vault: Dynasty Trusts & GSTT Mastery
How to pass wealth down 10+ generations without paying the 40% Estate Tax toll at every transfer.
Executive Summary
- The 40% Erosion: Without planning, the IRS takes ~40% of wealth at every generation transfer. A Dynasty Trust acts as a firewall, stopping this cycle.
- GSTT Exemption: You must allocate your Generation-Skipping Transfer Tax (GSTT) exemption (currently ~$13.6M+) to the trust to make it permanently tax-exempt.
- Jurisdiction Matters: You must site the trust in a state like South Dakota (SD) or Nevada (NV) that abolished the “Rule Against Perpetuities” (RAP).
The Rule Against Perpetuities (RAP)
Most states (e.g., NY, CA) force trusts to dissolve after ~90 years (or 21 years after a life in being dies). To build a true “Forever Vault,” you must use a dynasty-friendly state jurisdiction.
Mechanic: The Multi-Gen Compounder
Forever
Trust Duration
0%
Estate Tax
SD/NV/DE
Key States
Asset Prot.
Lawsuit Proof
Simulation: 3 Generations ($20M Starting Capital)
Wealth Preservation: Direct Gift vs. Dynasty Trust
| State Jurisdiction | Rule Against Perpetuities | State Income Tax |
|---|---|---|
| California / New York | Trust Ends ~90 Years | High (13%+) |
| South Dakota (SD) | Abolished (Forever) | 0% (Tax Haven) |
| Nevada (NV) | 365 Years | 0% (Tax Haven) |
“True wealth is not just what you keep, but what your great-grandchildren get to keep. The Dynasty Trust is the vessel for immortality.”
Essential Resources
INTERNAL
BMT Playbooks