What is a generation skipping tax? How is it different from a gift tax? Who needs to worry about it?
In brief, it means that one's property will be passed down only a couple of generations, and anything that past will make that person subject to the tax especially when he or she gives a large amount to their grandchildren. In this case, the IRS considers this sum of money as a gift and you know the rest of the story. so, If you are a millionaire then you have better ask your accountant for the current exclusion amounts to avoid further problems.