Crummey Trusts

A Crummey Trust is a specific type of trust that allows contributions to be treated as gifts eligible for the annual gift tax exclusion. This enables the grantor (the person setting up the trust) to make tax-free gifts to beneficiaries, usually children or grandchildren. The beneficiaries are given a temporary right to withdraw contributions for a limited time, which qualifies the gifts for tax benefits. Once the withdrawal period ends, the assets remain in the trust, managed for the beneficiaries' future needs. This structure helps in estate planning while minimizing tax implications.