Generation-Skipping Transfer Tax Calculator
The generation-skipping transfer (GST) tax applies to transfers to a skip person such as a grandchild. The tax is the taxable amount times an applicable rate equal to the maximum federal estate tax rate multiplied by the inclusion ratio. The inclusion ratio is 1 minus the share of the transfer sheltered by allocated GST exemption, so allocating exemption equal to the full transfer drives the tax to zero. This calculator takes the transfer amount, the GST exemption you allocate, and the flat federal rate, derives the inclusion ratio and applicable rate, and estimates the GST tax due. Confirm the current exemption and rate with the IRS.
GST tax formula
Applicable fraction = min(exemption, transfer) / transfer
Inclusion ratio = 1 - applicable fraction
Applicable rate = max federal rate * inclusion ratio
GST tax = transfer * (applicable rate / 100)
Net to skip person = transfer - GST tax
When allocated exemption equals or exceeds the transfer, the inclusion ratio is zero and no GST tax is due. Partial exemption produces an inclusion ratio between 0 and 1.
US GST tax context
- A skip person is generally two or more generations below the transferor, such as a grandchild.
- The GST tax is separate from and in addition to gift and estate tax.
- The applicable rate equals the top federal estate tax rate times the inclusion ratio.
- The lifetime GST exemption is set by law and indexed for inflation; it is not portable between spouses.
- Allocating exemption to a transfer reduces or eliminates the inclusion ratio and the tax.
GST tax: frequently asked questions
What is the generation-skipping transfer tax?
The GST tax is a federal tax on transfers to a skip person, generally a grandchild or someone two or more generations below the transferor. It is imposed in addition to gift or estate tax and is designed to prevent families from avoiding a layer of transfer tax by skipping a generation.
How is the GST tax calculated?
The GST tax equals the taxable amount times the applicable rate. The applicable rate is the maximum federal estate tax rate times the inclusion ratio. The inclusion ratio is 1 minus the fraction of the transfer sheltered by allocated GST exemption. This calculator builds the inclusion ratio from your exemption allocation.
What is the GST exemption?
Each transferor has a lifetime GST exemption that can be allocated to transfers to shelter them from GST tax. The exemption amount is set by law and indexed for inflation. Enter the exemption you allocate to this transfer as a user-editable input.
What rate applies to the GST tax?
The GST tax uses the maximum federal estate tax rate as the base, currently a flat top rate. Because the rate is set by statute, this calculator uses the rate you enter so you can match the law for the transfer year. Confirm the rate with the IRS.
Is the GST exemption portable like the estate exclusion?
No. Unlike the estate tax basic exclusion, the GST exemption is not portable between spouses. Each spouse must use or allocate their own GST exemption; any unused amount is not transferable to a surviving spouse.
Official sources
- Legal Information Institute (Cornell Law): 26 U.S. Code Chapter 13 (GST tax).
- Internal Revenue Service: Estate and Transfer Tax.
Reviewed by the CalculatorHub team, edited by James Graham, 17 June 2026. See our methodology.