Wealth Management Update

August 2023 AFRs and 7520 Rate

The August 2023 Section 7520 rate for use with estate planning techniques such as CRTs, CLTs, QPRTs and GRATs is 5%, an increase from the July 2023 rate of 4.6%. The August applicable federal rate ("AFR") for use with a sale to a defective grantor trust or intra-family loan with a note having a duration of:

• 3 years or less (the short-term rate, compounded annually) is 5.07%, up from 4.8% in July;
• 3 to 9 years (the mid-term rate, compounded annually) is 4.09%, up from 3.85% in July; and
• 9 years or more (the long-term rate, compounded annually) is 4.03%, up from 3.98% in July.

California Passes Law Taxing Incomplete Gift Non-Grantor Trusts in Same Manner as Grantor Trusts – S.B. 131