Wealth Management Update

August 2025 Interest Rates for GRATs, Sales to Defective Grantor Trusts, Intra-Family Loans and Split-Interest Charitable Trusts

The August Section 7520 rate for use in estate planning techniques such as CRTs, CLTs, QPRTs and GRATs is 4.80%, a decrease from the July rate of 5.00%. The August applicable federal rate ("AFR") for use with a sale to a defective grantor trust or infra-family loan with a note having a duration of:

• 3 years of less (the short-term rate, compounded annually) is 4.03%, down from 4.12% in July.
• 3 years to 9 years (the mid-term rate, compounded annually) is 4.06%, down from 4.19% in July.
• 9 years or more (the long-term rate, compounded annually) is 4.82%, down from 4.90% in July.