Sandy Springs Estate Planning for Grandparents Wanting to Leave Gifts to Grandchildren

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Grandparents in Sandy Springs and across the Atlanta metro area share a common goal: they want to pass something meaningful on to their grandchildren. Whether that means funding a college education, building a nest egg, or transferring family wealth across generations, the desire to give is powerful. But giving the right way, with the right legal tools, makes all the difference. Slowik Estate Planning, located in Atlanta, Georgia, helps grandparents build thoughtful, legally sound plans that protect their gifts and honor their intentions.

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Why Grandparents Need a Dedicated Gifting Strategy

A simple cash gift to a grandchild feels easy. Write a check, hand it over, done. But without a proper plan, that gift can trigger tax consequences, create family conflict, or get consumed by a grandchild’s creditors or a future divorce. Grandparents who live in Sandy Springs, Dunwoody, or anywhere along the GA-400 corridor often have significant assets, and those assets deserve a strategy, not just a gesture.

Under Georgia law, when a person dies without a will, the rules in O.C.G.A. Title 53, Chapter 2 govern how assets are distributed. Grandchildren are generally not first in line under Georgia’s intestate succession rules. If your adult child predeceases you, your grandchild may inherit through that child’s share, but there is no guarantee. A will or trust changes that completely. It puts your wishes in writing and makes your grandchildren direct beneficiaries, no matter what happens to the generations in between.

There is also the issue of control. A direct gift to a minor grandchild has no built-in guardrails. Georgia law does not allow minors to own property outright, which means a court may need to appoint a guardian of the property. That process runs through the Fulton County Probate Court, takes time, and costs money. A properly drafted trust avoids that entirely. Working with an Atlanta estate planning lawyer at Slowik Estate Planning gives you the tools to give generously while keeping your plan structured and protected.

Grandparents also need to think about what happens if a grandchild is still a teenager or young adult when they receive an inheritance. A 19-year-old receiving a large lump sum without conditions is a recipe for poor decisions. A trust lets you set the terms, whether that means distributing funds at age 25, tying distributions to educational milestones, or releasing funds gradually over time.

Annual Gifting and the Federal Gift Tax Exclusion

One of the most straightforward ways to transfer wealth to grandchildren is through annual gifts. The IRS allows you to give each of your grandchildren $19,000 in 2026 without triggering any gift tax reporting requirements. If you are married, you and your spouse can effectively double that amount to $38,000 per recipient. For a grandparent with four grandchildren, that means up to $152,000 per year, per couple, flowing out of a taxable estate completely tax-free.

Gifts that fall within the annual exclusion do not reduce your lifetime exemption and do not require a gift tax return. That is a significant benefit. Estates of decedents who die during 2026 have a basic exclusion amount of $15,000,000, up from $13,990,000 for estates of decedents who died in 2025. The One, Big, Beautiful Bill was signed into law on July 4, 2025, as Public Law 119-21, and it increases the basic exclusion amount to $15,000,000 for gifts for calendar year 2026. Georgia does not impose its own state gift tax, so gifts made to grandchildren living in the Atlanta area are only subject to federal rules.

If you give more than $19,000 to a single grandchild in one year, you must file IRS Form 709. Filing Form 709 does not mean you will owe tax. You will likely draw down part of your $15 million lifetime exemption instead. For most families in Sandy Springs, that lifetime cushion is more than sufficient to cover generous gifting over many years without ever paying a dollar in gift tax.

One important rule to keep in mind involves transfers made close to death. Under IRC § 2035, certain transfers made within three years of death can be pulled back into your taxable estate. This is especially relevant for life insurance policies transferred to a grandchild or a trust. Timing matters, and a plan reviewed regularly by Slowik Estate Planning accounts for these rules before they become a problem.

Trusts Designed for Grandchildren: Your Best Planning Tool

A trust is the most flexible and protective vehicle for leaving gifts to grandchildren. It lets you transfer assets now or at death, set conditions for distributions, protect funds from a grandchild’s creditors, and avoid the delays of Georgia’s probate process. For grandparents near Perimeter Center or Roswell Road who have accumulated real estate, investment accounts, or business interests, a trust is often the right answer.

Two common trust structures for grandchildren are the revocable living trust and the irrevocable trust. A revocable trust lets you maintain control during your lifetime. You can change it, add assets, or revoke it entirely. At your death, the trust continues for your grandchildren’s benefit without going through probate. Working with a skilled trust attorney at Slowik Estate Planning ensures your trust is properly funded and legally sound under Georgia law.

An irrevocable trust removes assets from your taxable estate permanently. Once funded, you give up control, but you gain estate tax protection and creditor shielding. For grandparents with larger estates, this trade-off is often worthwhile. Under IRC § 2036, if you retain the right to enjoy the income from transferred property, that property stays in your taxable estate. Proper irrevocable trust drafting avoids this trap by ensuring you truly relinquish control.

A generation-skipping trust, sometimes called a dynasty trust, is another powerful option. It allows assets to pass to grandchildren, and even great-grandchildren, while minimizing estate taxes at each generational level. This is where the Generation-Skipping Transfer (GST) Tax under IRC §§ 2601 through 2642 comes into play. As of January 1, 2026, the GST tax exemption has increased to $15,000,000 per person, which is a combined $30,000,000 for a married couple. Grandparents who plan carefully can shelter significant wealth from the 40% GST tax rate using this exemption.

Using 529 Plans to Fund a Grandchild’s Education

Georgia’s Path2College 529 Plan is one of the most practical tools grandparents can use to give a grandchild a financial head start. Georgia taxpayers filing jointly can deduct up to $8,000 per year per beneficiary in Path2College 529 Plan contributions from their Georgia adjusted gross income, while individual filers can deduct up to $4,000. That is a real, immediate tax benefit on top of the long-term advantages of tax-free growth.

Georgia sets an aggregate lifetime limit of $235,000 per beneficiary for its 529 plan. That cap applies to total contributions, not to investment growth. Investment earnings that push the balance above the limit do not trigger penalties. For grandparents who want to contribute more, opening a 529 in another state is an option, since federal law does not prohibit holding accounts in multiple states.

One powerful feature of 529 plans is superfunding. This strategy allows you to contribute up to five years’ worth of gifts at once, which equals $95,000 per person or $190,000 per married couple in 2026, while spreading the gift tax impact over five years. You file IRS Form 709 and elect five-year averaging. During that five-year period, you cannot make additional annual exclusion gifts to the same grandchild without dipping into your lifetime exemption.

The Path2College 529 Plan also covers more than just college tuition. Up to $20,000 annually can be used toward K-12 tuition per student. If a grandchild attends a private school in Atlanta, such as one of the many schools near the I-285 corridor, those tuition payments can come from the 529 account tax-free. Grandparents looking to reduce exposure to estate tax may contribute to a grandchild’s 529 plan as part of an estate planning strategy, and Slowik Estate Planning can show you exactly how to integrate that into your broader plan.

The Generation-Skipping Transfer Tax and How to Plan Around It

When assets pass directly from a grandparent to a grandchild, skipping the middle generation entirely, the IRS takes notice. The Generation-Skipping Transfer Tax, governed by IRC §§ 2601 through 2642, applies a flat 40% tax on transfers that skip a generation. This applies whether the transfer is made during life or at death, and whether it goes directly to the grandchild or through a trust for the grandchild’s benefit.

The GST tax is in addition to, not instead of, the estate and gift tax. That means a poorly planned transfer could face a combined tax burden that significantly reduces what a grandchild actually receives. The highest federal estate tax, gift tax, and GST tax rate remains at 40% for 2026. For a Sandy Springs grandparent with a taxable estate above the exemption threshold, that rate is not theoretical. It is a real cost that proper planning can reduce or eliminate.

The GST exemption, now set at $15,000,000 per person in 2026, gives grandparents a large shield. Allocating that exemption correctly to trusts and direct transfers is a technical task that requires careful attention. Under IRC § 2642, the GST inclusion ratio determines how much of a trust’s distributions will be subject to the GST tax. Getting that ratio to zero, by fully allocating your exemption, is the goal. An estate tax planning lawyer at Slowik Estate Planning can walk you through the allocation process and make sure your exemption is used in the most effective way possible.

Direct tuition payments to educational institutions are completely exempt from the GST tax, just as they are exempt from the gift tax. The IRS permits unlimited payments for someone else’s tuition, provided the payment is made directly to a qualified institution, and this exclusion applies to tuition only. In 2026, you could pay $50,000 of your grandchild’s college tuition directly to the college and still give another $19,000 tax-free under the annual exclusion. For grandparents with grandchildren at Georgia Tech, Emory, or any other accredited institution, this is an immediate and powerful planning opportunity that does not consume any exemption at all.

FAQs About Sandy Springs Estate Planning for Grandparents Wanting to Leave Gifts to Grandchildren

Does Georgia have its own gift tax that applies when I give money to my grandchildren?

Georgia does not impose a state-level gift tax. Gifts you make to grandchildren in Georgia are only subject to federal gift tax rules. In 2026, the annual federal gift tax exclusion is $19,000 per recipient, and the lifetime exemption is $15,000,000 per individual. Most grandparents in Sandy Springs will never owe federal gift tax, but it is still important to document gifts properly and file IRS Form 709 when a single gift to one grandchild exceeds the $19,000 annual limit.

What happens to a gift I leave to a minor grandchild if I do not have a trust?

Georgia law does not allow minors to own property outright in significant amounts. If you leave a direct bequest to a minor grandchild without a trust, the Fulton County Probate Court may need to appoint a guardian of the property to manage the assets until the child turns 18. At 18, the grandchild receives everything outright, with no conditions. A properly drafted trust avoids the probate court entirely, keeps the assets protected, and lets you set the age and conditions for distributions. Slowik Estate Planning can draft a trust tailored to your exact wishes.

What is the Generation-Skipping Transfer Tax and does it apply to my estate?

The Generation-Skipping Transfer Tax is a federal tax under IRC §§ 2601 through 2642 that applies when assets pass directly from a grandparent to a grandchild, skipping the middle generation. The flat tax rate is 40%. In 2026, each individual has a GST exemption of $15,000,000, which means most families will not owe this tax. However, proper allocation of that exemption to trusts and direct transfers is critical. Without careful planning, some transfers can be subject to both estate tax and GST tax at the same time. Slowik Estate Planning helps grandparents allocate their GST exemption correctly.

Can I use Georgia’s Path2College 529 Plan to leave an education gift to my grandchildren?

Yes, and it is one of the most tax-efficient ways to do it. Georgia’s Path2College 529 Plan lets grandparents contribute up to $19,000 per grandchild per year without any gift tax consequences. Married grandparents can contribute up to $38,000 per grandchild per year. You can also superfund the account with up to $95,000 as a single contributor, or $190,000 as a married couple, by electing five-year gift-tax averaging on IRS Form 709. Georgia taxpayers filing jointly can also deduct up to $8,000 per beneficiary per year from their Georgia adjusted gross income. Slowik Estate Planning can help you integrate 529 contributions into a broader estate plan.

How does Slowik Estate Planning help grandparents in Sandy Springs create a gifting plan?

Slowik Estate Planning, based in Atlanta, Georgia, works with grandparents to build comprehensive estate plans that include wills, trusts, 529 contributions, annual gifting strategies, and GST tax planning. The firm helps clients understand the current federal and Georgia laws that affect transfers to grandchildren, and drafts the legal documents needed to carry out their wishes. Every plan is built around the client’s specific family, assets, and goals. Slowik Estate Planning does not guarantee specific outcomes, and every situation is unique, but the firm is committed to providing clear, practical guidance. Contact Slowik Estate Planning today to schedule a consultation.

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