Crummey Trust

A Crummey Trust is a type of trust that allows contributions to qualify for the annual gift tax exclusion. It lets parents or grandparents contribute money to the trust while giving beneficiaries a limited right to withdraw funds for a short time. This withdrawal option, though temporary, satisfies IRS requirements, allowing the gift to be excluded from taxable gifts. After the withdrawal period ends, the remaining funds stay in the trust, managed according to the grantor's wishes, often for the benefit of the beneficiaries, such as children, without facing immediate gift taxes.