Grate

(redirected from GRAT)
Also found in: Dictionary, Thesaurus, Financial, Acronyms.
Related to GRAT: gratis

grate

[grāt]
(engineering)
A support for burning solid fuels; usually made of closely spaced bars to hold the burning fuel, while allowing combustion air to rise up to the fuel from beneath, and ashes to fall away from the burning fuel.

Grate

A frame that consists of parallel metal bars, attached by cross bars at regular intervals; used as a grille or security device.

grate

A surface with suitable openings to support a fuel bed, such as coal, and permit passage of air through the burning fuel. Designed to permit removal of unburned residue, and may be horizontal or inclined, stationary or movable.
References in periodicals archive ?
A GRAT is also a bet that the assets the client places into the trust will appreciate in value at a rate that is greater than an IRS-prescribed interest rate.
Short-term GRATs reduce both the risk of the grantor dying during the term of the GRAT and the possibility of a substantial decrease in the value of the GRAT assets, thereby leaving little or nothing to pass to the children at the end of the annuity term.
The Treasury Regulations provide two methods of calculating the annuity amount: the first is used if no substitute residence is purchased and the whole trust will be converted to a GRAT; the second is used if a substitute residence is purchased with a portion of the trust property and the excess will be converted to a GRAT.
Further, for clients who established GRATs to protect themselves against a transfer tax hit brought about by the "fiscal cliff" of January 1, 2013, the gift and estate tax planning goals that motivated them to create the GRAT may no longer exist because of the now-permanent $5 million exemption ($5.43 million in 2015).
A shorter trust term also helps increase the odds that the GRAT will succeed in lowering overall taxes.
This allows for cash flow flexibility while hopefully further compounding the investment returns within the PFLP (and provides another advantage over a GRAT, since GRAT annual annuities must be paid timely).
Dynasty trusts are similar to GRATs in that the grantor can put assets into the trust, and those assets are subject to gift tax at their present value, at the time the trust is established.
When the GRAT term is reached the business passes to the grantor's children or to a trust for their benefit of the children.
When the IRC 7520 rate drops, as it has in recent months, grantors can reimburse themselves less during the GRAT term.
To prevent this short term hedging and planning that circumvents estate and gift tax, congress has tried to push through legislation that would make the GRAT trust less desirable and less effective, such as requiring a 10-year term or that there be trust remainder (not all principal returned to the settlor).
Example 1: Sheila Simmons transfers stock worth $500,000 to a GRAT. She sets a trust term of four years and agrees to receive an annuity of $135,000 a year from the trust.