1. Grantor Can Retain Limited Power of Appointment (LPOA)
    1. Purpose of Retaining LPOA
    2. Gift Tax: Gift Is Incomplete and Not Taxable

Grantor Can Retain Limited Power of Appointment (LPOA)

Purpose of Retaining LPOA

The purpose of retaining a limited power of appointment is two-fold:

  • The grantor retains control to designate new beneficiaries
  • The gift is an incomplete gift for purposes of the gift tax
  • Flexibility in case of changed circumstances (e.g., one or both spouses needs institutional care before the look back period expires)

Gift Tax: Gift Is Incomplete and Not Taxable