Raleigh Grantor Retained Annuity Trusts and Qualified Personal Residence Trusts Attorney

Freeze the value, give away the growth

Both of these trusts work on the same principle: you keep something for a period of years, give away what is left at the end, and the IRS values the gift today at a steep discount. If you survive the term, the growth belongs to your family and was never taxed.

The GRAT

• You transfer an asset you expect to appreciate (company stock before a sale, a concentrated stock position, real estate) to a trust and take back an annuity for two or more years that returns the full value plus a modest IRS-assumed rate of return.
• Because the annuity returns the full value, the gift is essentially zero, and none of your exclusion is used.
• Whatever the asset earns above the IRS rate passes to your children (or a dynasty trust) at the end of the term with no gift tax.
• If the asset underperforms, everything comes back to you, and nothing is lost but the legal fees. GRATs are typically done in a series to capture growth year after year.

The QPRT

• You deed your home, or a vacation home, to a trust and keep the right to live there rent-free for a fixed term, often ten years or more.
• The gift is only the value of the home at the end of the term, discounted for the years you keep it, which is often half the home's value or less.
• After the term, the home belongs to your children or a continuing trust, and all of its appreciation has left your estate. You may continue to live there by paying fair market rent, which moves even more wealth to the family.
• Married couples often create two QPRTs, one for each spouse's half, which adds a further discount.

Who should consider them?

• A GRAT: anyone with an asset likely to grow faster than the IRS rate in the next few years, especially before a business sale.
• A QPRT: anyone with a valuable home they intend to keep in the family and the health to see the term through.

How we price advanced planning

Advanced planning is priced case by case. These trusts are significantly more complex than a standard revocable trust or a Medicaid asset protection trust: each one involves tax modeling, valuation, coordination with your CPA and financial advisor, and years of administration that the document has to anticipate. For that reason, they are not on our flat-rate menu. After your consultation, we quote a flat fee for your specific plan, so you still know the full cost before any work begins.

Common questions

What happens if I die during the term?

The asset (or the home) is included in your estate, exactly as if you had done nothing. Advanced planning of this kind has a built-in downside limit.

Why do these have to be done so precisely?

The IRS regulations dictate the exact terms. A GRAT annuity paid late, or a QPRT holding the wrong assets, can disqualify the whole trust. Our documents follow the IRS sample forms, and we calendar every required payment.

Call to action

Don't wait to schedule a consultation with Kevin Peach. We will tell you plainly whether advanced planning is right for your family and quote a flat fee for your plan. 

Call (919) 759-6353 today to schedule an initial consultation with our firm.

Disclaimer: This page is general information about North Carolina and federal estate planning, not legal advice, and does not create an attorney-client relationship. Exemption amounts are as of 2026 and change annually. Every plan depends on the client's facts, and no result is guaranteed.