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Navigating the Generation-Skipping Transfer Tax for Genuine Parts Families

Healthcare Provider Update: Healthcare Provider for Genuine Parts: Genuine Parts Company, primarily known for its automotive replacement parts, benefits from its association with several healthcare providers, but its specific health insurance options are not publicly detailed. Generally, employees are likely covered under major national providers such as UnitedHealthcare, Anthem, or Aetna, which offer group health plans as part of their employee benefits. Potential Healthcare Cost Increases in 2026: Healthcare consumers can anticipate significant premium hikes in 2026, driven by the looming expiration of enhanced subsidies under the Affordable Care Act (ACA). Reports indicate that many states could see premiums increase by as much as 66%, with average national hikes exceeding 20%. These increases stem from soaring medical costs and projected double-digit rate adjustments proposed by major insurers, putting additional financial strain on millions of Americans reliant on marketplace plans. If not addressed, this combination of factors could push some consumers' out-of-pocket healthcare expenses up by 75% or more, effectively pricing many individuals out of adequate coverage. Click here to learn more

'Thoughtful multigenerational planning can help Genuine Parts employees navigate GSTT considerations more effectively, making it an essential part of preparing families for long-term financial transitions.' -- Paul Bergeron, a representative of The Retirement Group, a division of Wealth Enhancement.

'Carefully structuring multigenerational wealth transfers can help Genuine Parts employees stay aligned with GSTT rules and should be considered when discussing long-term family planning priorities.' -- Tyson Mavar, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

Key concepts behind the generation-skipping transfer tax (GSTT).
Common exemptions and exclusions that may lessen transfer tax exposure.
Planning methods that can help families pass wealth across generations.

Important Takeaways on How to Transfer Wealth Across Generations

The generation-skipping transfer tax (GSTT) is relevant for any Genuine Parts employees transferring wealth to grandchildren or other individuals that skip over your children's generation.

Both GSTT and gift or estate taxes may apply when transferring assets to heirs more than one generation below the transferor.

Exemptions may lower transfer tax liability if planning is structured thoughtfully.

Federal gift and estate taxes—applicable to transfers during life or at death—are familiar to many Genuine Parts employees. However, when assets move to people more than one generation below the transferor, such as a gift from a grandparent to a grandchild, the federal generation-skipping transfer tax (GSTT) may also apply.

Generation-Skipping Transfer Tax: What Is It?

Transfers to “skip persons,” those more than one generation below the transferor or more than 37½ years younger, are subject to the GSTT. This federal tax applies in addition to any federal gift or estate tax due and equals the highest federal gift and estate tax rate in effect—a flat rate of 40%—which is relevant for Genuine Parts employees engaging in multigenerational planning.

The GSTT was introduced in 1976 to address concerns that affluent families could shift assets in ways that bypassed estate taxes at each generational level. ¹

Lifetime Exemptions and Gift Tax Exclusions

Transfers made during life or at death to anyone other than a spouse or qualified charity may be subject to federal gift or estate tax. Key exclusions include several that may benefit Genuine Parts employees:

Annual gift tax exemption: In 2026, individuals may give up to $19,000 per recipient without incurring federal estate or gift tax. Couples may combine exclusions for a total of $38,000 per beneficiary. ² For example, a married couple with two children could give $76,000 total ($38,000 to each child) annually without gift tax.

Qualified transfers: Payments made directly to educational institutions for tuition or to medical providers for medical expenses are not considered taxable gifts. There is no dollar limit on these transfers. ¹

Lifetime unified exclusion: Individuals may transfer up to $13.99 million (or $27.98 million per married couple) during life or at death without federal gift or estate tax. ² Lifetime gifts reduce the remaining exclusion available at death.

Transfers exceeding these exclusions are taxed at the top federal estate and gift tax rate of 40%.

Exclusions & Exemptions from GSTT

The GSTT has rules similar to traditional gift tax laws, which can influence planning for Genuine Parts families:

- Grandparents may give up to $19,000 directly to a grandchild in 2026 without triggering gift tax or GSTT.
- Each individual has a $13.99 million lifetime GSTT exemption ($27.98 million per couple), though this exemption is not independent from estate or gift tax rules.
Transfers above exemption thresholds are subject to a 40% GSTT.
GSTT applies only at the federal level, although some states may impose their own estate or inheritance taxes.

When Does the GSTT Start to Apply?

The GSTT applies to three types of taxable events, all of which may arise in multigenerational planning for Genuine Parts families:

Direct skips: Transfers made directly to a skip person or to a trust for their exclusive benefit. The transferor or their estate pays the tax.

Taxable distributions: Distributions from a trust to a skip person. The beneficiary pays the tax.

Taxable terminations: Occur when a trust interest ends and only skip persons remain as beneficiaries. The trustee pays the tax.

GSTT Exemption Allocations

Transfers—outright or to a trust—may qualify for GSTT exemption as long as the exemption is properly allocated. Once allocated, all future growth on those trust assets is generally free from GSTT, a strategy Genuine Parts families may want to use.

For example, if a person contributed $10 million to an irrevocable trust for grandchildren in 2024 and allocated the GSTT exemption, and the trust later grew to $20 million, future distributions would not incur GSTT. ¹

Methods for Lowering GSTT

1. 529 Plan Contributions

Contributions to 529 college savings plans are treated as completed gifts, even though account owners can change the beneficiary. Grandparents may “superfund” a 529 plan with five years of annual exclusions at once—up to $95,000 per beneficiary in 2025 or $190,000 per beneficiary for a married couple filing jointly ³ —which may interest Genuine Parts retirees.

2. Dynasty Trusts

Dynasty trusts are irrevocable trusts designed to last across multiple generations. Some states allow long-term or perpetual trusts, while others limit trust duration under the “rule against perpetuities.” These trusts can combine GSTT planning with long-term asset preservation features and, when fully exempt from GSTT, future distributions or terminations can occur without additional GSTT ⁴ —an appealing option for extended family planning.

Concluding Remarks

Although GSTT planning can be complex, exemptions and structured transfers may help Genuine Parts employees reduce or eliminate federal taxes on wealth passed to grandchildren or other skip persons.

The Retirement Group can assist you with wealth transfer planning and retirement income strategies. Call our team at (800) 900-5867 for guidance.

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Articles you may find interesting:

Sources:

1. Fidelity Investments. “Understanding the Generation-Skipping Transfer Tax.” Fidelity , 3 Oct. 2025, www.fidelity.com/viewpoints/wealth-management/insights/generation-skipping-transfer-tax .

2. Internal Revenue Service. “ IRS releases tax inflation adjustments for tax year 2027 .” IRS.gov , 9 Oct. 2025.

3. Bendig, Erin. “How This 529 ‘Superfund’ Strategy Can Transform Your Estate Plan.” Kiplinger , 12 Sept. 2025, www.kiplinger.com/personal-finance/this-super-529-strategy-can-help-you-jumpstart-college-savings .

4. Investopedia. ' What Is a Dynasty Trust? ' by Will Kenton. 31 March 2025.

What benefits does the GPC Pension Plan provide to employees of Genuine Parts Company, and how are these benefits calculated for both Group 1 and Group 2 employees? In the context of Genuine Parts Company, what are the critical factors that determine the pension benefits for employees and how have recent changes to the plan affected these calculations?

The benefits of the GPC Pension Plan for Genuine Parts Company employees are calculated based on the employee’s Final Average Monthly Earnings (FAME) and years of Credited Service. For Group 1 employees, benefits are frozen as of December 31, 2013, with the FAME calculated from the five highest-paid years within the last ten years of service before that date. For Group 2 employees, benefits are similarly frozen as of December 31, 2008, and the same calculation of FAME is applied using the highest earnings before that freeze date(Genuine Parts Company_P…).

How do the eligibility requirements of the GPC Pension Plan differ between Group 1 and Group 2 employees at Genuine Parts Company? Additionally, what specific service requirements must employees meet to qualify for the benefits under each group, particularly considering the impact of employment history and rehire status on benefits?

Eligibility requirements differ between Group 1 and Group 2 employees. Group 1 includes employees with Rule of 70 status, who opted to continue participation in the plan after January 1, 2009. Group 2 employees, which include those rehired before December 31, 2013, had their Credited Service frozen earlier in 2008. Group 1 employees have Credited Service frozen as of December 31, 2013, while Group 2’s freeze date is December 31, 2008(Genuine Parts Company_P…).

What strategies can employees of Genuine Parts Company consider for optimizing their pension benefits when transitioning to retirement? Are there specific actions that employees should take prior to retirement to enhance their benefit calculations under the GPC Pension Plan, particularly in relation to Credited Service and Final Average Monthly Earnings?

To optimize pension benefits, Genuine Parts Company employees should focus on maximizing Credited Service and Final Average Monthly Earnings (FAME). Ensuring a full work history before the freeze date (2013 for Group 1, 2008 for Group 2) can enhance the benefit calculation. Employees can also review their Social Security benefit estimates, which are considered in calculating their pension(Genuine Parts Company_P…).

How does the vesting process work for employees participating in the GPC Pension Plan at Genuine Parts Company, and what implications does it have for those contemplating early retirement? Furthermore, how does the ability to vest at different service intervals specifically impact the retirement planning of employees?

The vesting process for the GPC Pension Plan requires employees to accumulate vesting service years, which continues even after the freeze date. Employees are automatically fully vested after seven years of service, or if they worked at least one hour after December 31, 2013. Vesting ensures the right to the earned pension benefits, which may affect retirement planning, especially for those contemplating early retirement(Genuine Parts Company_P…).

What information should Genuine Parts Company employees know about the different forms of payment available under the GPC Pension Plan once they reach retirement age? How do options such as life annuities and lump-sum payments affect the overall financial planning for retiring employees?

Genuine Parts Company employees can choose from various forms of pension payments upon retirement, including life annuities, joint and survivor annuities, and lump-sum payments. Each option affects financial planning differently: life annuities provide steady income, while lump sums offer flexibility but require careful management to ensure long-term financial stability(Genuine Parts Company_P…).

In the event of a termination of employment, what options are available for employees of Genuine Parts Company to access their pension benefits under the GPC Pension Plan? Additionally, what are the specific procedures that employees must follow to ensure they receive their benefits in a timely manner?

In the event of termination, employees who are vested can access their pension benefits, either at their normal retirement age or earlier if they meet the eligibility criteria for early retirement. Employees must submit a request within 180 days of their termination date to receive benefits, with options for lump sum payments for amounts under $75,000(Genuine Parts Company_P…)(Genuine Parts Company_P…).

How can employees of Genuine Parts Company ensure that their beneficiaries are appropriately named under the GPC Pension Plan? What considerations should employees keep in mind when designating beneficiaries, particularly understanding consent needs for spouses and the impact of domestic relations orders?

Genuine Parts Company employees should ensure their beneficiaries are properly named, particularly if married. A spouse is the default beneficiary, but spousal consent is required if an employee designates someone else. Domestic relations orders may also affect beneficiary designations(Genuine Parts Company_P…).

What unique situations might affect the pension benefits of employees at Genuine Parts Company, and how does the plan specifically address employees on military leave or long-term disability? In these circumstances, what communication strategies should employees employ to navigate their benefits?

For employees on military leave or long-term disability, the GPC Pension Plan provides special rules for calculating benefits. These employees should maintain close communication with the Employee Service Center to ensure their benefits are appropriately adjusted(Genuine Parts Company_P…).

Regarding the reporting and update of personal information, why is it essential for employees of Genuine Parts Company to keep the GPC Employee Service Center informed about any changes in marital status or address? How can failure to report these changes potentially impact the pension benefits they receive?

Employees must keep the GPC Employee Service Center informed of any changes in marital status or address, as failure to do so could result in delayed or incorrect pension benefit payments(Genuine Parts Company_P…).

How can employees at Genuine Parts Company reach out for further clarification on the details presented in the Summary Plan Description of the GPC Pension Plan? What resources or contact points are available that could assist in navigating the complexities of the pension plan, ensuring employees can maximize their benefits effectively?

Genuine Parts Company employees can reach out to the GPC Retirement Plan Services through their toll-free number or website for clarification on the pension plan details. These resources are crucial for navigating the complexities of the pension system(Genuine Parts Company_P…).

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Pension Plan Name of the Pension Plan: Genuine Parts Company Defined Benefit Pension Plan Years of Service and Age Qualification: Employees generally need to have at least 5 years of service to qualify for benefits. Full benefits typically begin at age 65, but early retirement options may be available with reduced benefits. Pension Formula: The pension is calculated based on a formula that takes into account the employee's years of service and average salary over the highest-paid years. 401(k) Plan Name of the 401(k) Plan: Genuine Parts Company 401(k) Plan Eligibility: Employees are eligible to participate in the 401(k) plan after completing 30 days of service. 401(k) Plan Details: The plan allows employees to contribute a portion of their salary to a tax-deferred account, with potential company matching contributions.

Restructuring and Layoffs: In early 2024, Genuine Parts announced a significant restructuring initiative aimed at streamlining operations and enhancing efficiency. This restructuring plan includes the reduction of approximately 5% of its workforce across various divisions. This move is expected to help the company better adapt to market fluctuations and optimize its operational costs. The restructuring reflects broader industry trends as companies adapt to evolving economic pressures and changing market dynamics.

Genuine Parts Company (GPC) Stock Options and RSUs in 2022 GPC offered stock options and RSUs to executives and key employees as part of their compensation package. The stock options typically included a strike price set at market value at the grant date. RSUs granted by GPC generally vested over a period of three to four years, with the exact vesting schedule specified in individual agreements. Genuine Parts Company (GPC) Stock Options and RSUs in 2023 In 2023, GPC continued to offer stock options and RSUs to their management team and senior employees. The stock options were often part of performance-based compensation. The RSUs were allocated with a focus on aligning employee incentives with company performance, typically vesting in tranches over a multi-year period. Genuine Parts Company (GPC) Stock Options and RSUs in 2024 For 2024, GPC maintained its stock option and RSU programs, enhancing the benefits for senior executives and select high-performing employees. The company adjusted the vesting criteria and performance metrics for RSUs to reflect the company's strategic goals and market conditions.

1. Official Website and Key Benefits Information Genuine Parts Company Official Website Visit: Genuine Parts Careers Review sections on employee benefits and health plans. Look for specific healthcare-related terms and acronyms. Key Terms and Acronyms: HDHP: High Deductible Health Plan HSA: Health Savings Account EAP: Employee Assistance Program FSA: Flexible Spending Account PPO: Preferred Provider Organization HMO: Health Maintenance Organization Recent Updates: Genuine Parts Company offers comprehensive health benefits, including medical, dental, and vision plans. They also provide wellness programs and access to telemedicine services. 2. Reliable Sources and Recent Employee Healthcare News a. Glassdoor Search for Genuine Parts Company’s benefits reviews. Look for employee feedback on healthcare coverage and recent changes. b. Indeed Check employee reviews and Q&A sections for insights into health benefits. c. LinkedIn Explore company posts and employee discussions about health benefits. d. BenefitsPro Look for articles or reports on Genuine Parts Company’s health benefits updates and changes. e. Business Insider Search for news articles related to recent changes in health benefits or related employee programs at Genuine Parts. 3. Summary of Findings Healthcare Plans: Genuine Parts offers a range of health insurance options including PPO and HDHP plans, with contributions to HSAs and FSAs. They also provide access to preventive care and wellness programs. Recent Changes: Recent updates to their health benefits have included enhancements to telemedicine services and expanded mental health support through EAP programs. Employee Feedback: Employees generally appreciate the comprehensive coverage but have noted that premium costs and deductibles can be high.