What Is a SLAT (Spousal Lifetime Access Trust)?

1. How Does a SLAT Work?

A SLAT works by making a completed gift from one spouse to an irrevocable trust for the other. The creating spouse, called the grantor, signs the trust and transfers property to it, often brokerage accounts, business interests or life insurance. The trustee can make distributions to the beneficiary spouse during that spouse’s life, and after the beneficiary spouse dies the property usually continues in trust for the children and grandchildren.

The couple keeps indirect access. The grantor cannot take anything back, but as long as the marriage lasts and the beneficiary spouse is alive, distributions to that spouse support the household. The trust is irrevocable, so the grantor cannot change the beneficiaries or cancel it, and that permanence is what keeps the property out of the grantor’s estate.

A SLAT differs from a GRAT, which pays the grantor an annuity and moves only growth, and from a bypass trust, which is created at the first death rather than during life. The comparison with the other Florida irrevocable trusts is on our hub page.

2. How Does a SLAT Use the $15,000,000 Exemption?

A SLAT uses the grantor’s federal gift and estate tax exemption, which is $15,000,000 per person in 2026 and is indexed for inflation after 2026. A gift to a SLAT does not qualify for the marital deduction, by design, because a marital deduction would pull the property back into the beneficiary spouse’s estate. The gift is reported on a federal gift tax return, Form 709, for the year of the transfer.

The value of the gift is fixed on the day it is made, and everything the property earns afterward is outside both estates. A $5,000,000 portfolio that doubles over 15 years leaves $10,000,000 in the trust and only the original $5,000,000 counted against the exemption, so for an estate already above the exemption, the growth alone avoids $2,000,000 of federal estate tax at the 40% rate.

The timing pressure has changed. Before 2025, the exemption was scheduled to fall by about half at the start of 2026, and many couples signed SLATs in a hurry to use the higher figure. Federal law now sets the exemption at $15,000,000 for 2026 with inflation increases afterward, so a SLAT today is chosen for its effect on growth and creditor protection rather than to beat a deadline. Couples near the line should also read our guide to portability, which lets a surviving spouse keep the first spouse’s unused exemption.

Gift splitting usually does not help. A married couple can normally treat a gift as made half by each spouse, but where the spouse is also a beneficiary, the regulations allow splitting only for a third-party interest that can be valued and separated at the time of the gift. In a typical SLAT the whole gift comes out of the grantor’s exemption.

3. Who Can Be Trustee of a SLAT?

The beneficiary spouse can be trustee of a SLAT, provided distributions to that spouse are limited to health, education, maintenance and support. Federal law treats that standard as ascertainable, so the power does not pull the property into the beneficiary spouse’s estate. Florida law imposes the same limit by default on any trustee who is also a beneficiary, unless the trust says expressly that the rule does not apply, and our page on limits on trustee discretion sets out the rule.

An independent trustee can do more. A child, a friend or a trust company serving alongside the spouse can be given broad discretion to distribute for any purpose, which the spouse alone could not safely hold. The grantor should not serve as trustee or hold the power to direct distributions, because control retained by the grantor can bring the property back into the grantor’s estate. Our guides to what a trustee is and the successor trustee cover who steps in later.

4. What Happens to a SLAT in a Divorce?

A divorce does not undo a SLAT. The gift was completed when the trust was funded, and the property does not come back to the grantor because the marriage ended. Florida’s statute that treats a former spouse as having died applies to revocable trusts only, so it does not reach an irrevocable SLAT, and our page on divorce and your trust covers that statute.

The former spouse can stay the beneficiary. A trust that names the beneficiary spouse by name keeps paying that person after the divorce. The common drafting answer is to define the spouse as whoever is married to the grantor at the time of a distribution, a clause planners call a floating spouse, so the benefit follows the marriage rather than the person. A premarital or postnuptial agreement can address the trust as well. Our guide to what happens to a trust in a Florida divorce covers the revocable side.

The grantor can keep paying the income tax. Federal law treats the grantor as holding any interest held by a person who was the grantor’s spouse when the interest was created, and the older rule that shifted the tax to the former spouse was repealed for divorces after 2018. A grantor can therefore owe income tax on trust income paid to a former spouse, and the trust should give an independent trustee the power to reimburse that tax.

5. Can Both Spouses Create a SLAT for Each Other?

Both spouses can create a SLAT, but two trusts that mirror each other can be uncrossed by the IRS under the reciprocal trust doctrine. The Supreme Court held in 1969 that where two trusts are interrelated and, to the extent of their mutual value, leave each spouse in about the same economic position as if each had created a trust for himself or herself, each spouse is treated as the creator of the trust that benefits him or her. No tax-avoidance motive has to be shown.

The answer is real difference. Couples who each create a SLAT sign them at different times, fund them with different property and different amounts, give the beneficiary spouses different rights (such as a power to direct the property at death in one trust and none in the other), and sometimes name different trustees or add children as current beneficiaries in only one. The case at the end of this page shows what happens without those differences.

6. Who Pays the Tax on a SLAT?

The grantor usually pays the income tax on a SLAT. Federal law treats the grantor as the owner of any trust whose income can be paid to the grantor’s spouse, which makes a SLAT a grantor trust, so the trust’s interest, dividends and gains are reported on the grantor’s return. Each dollar the grantor pays in tax is a dollar that stays in the trust for the family without counting as a gift.

Florida lets a trustee reimburse the grantor for that tax in the trustee’s discretion, unless the trust elects out, and a trustee who is the beneficiary spouse or a related party cannot make that call. The page on paying the grantor’s tax bill covers the rule.

The SLAT property does not get a new tax basis at the grantor’s death. A gift keeps the grantor’s original basis, while property that passes at death usually gets a basis equal to its value on the date of death, so a SLAT funded with low-basis stock trades an estate tax saving for a later capital gains tax. Our guide to the step-up in basis covers the tradeoff.

7. Why Make Florida the Trust’s Home?

Florida is a strong home, or situs, for a SLAT for four reasons. Florida has no state income tax on trust income, lets a trust created on or after July 1, 2022 last up to 1,000 years, and has a modern law that lets an investment adviser direct the trustee, covered in our guide to the Florida directed trust.

The fourth reason is a 2022 change to Florida’s trust code. Florida now treats the property of a qualifying SLAT, after the beneficiary spouse dies, as contributed by that spouse rather than by the grantor. The grantor can then be a beneficiary of the continuing trust without the trust being treated as the grantor’s own trust for creditor purposes. The rule applies where the spouse is a lifetime beneficiary, the grantor is not a beneficiary during the spouse’s life, and the gift was completed, and it remains subject to Florida’s fraudulent transfer law. Our page on creditors and your own trust covers the section.

Couples outside Florida can use these rules by naming a Florida trustee and making Florida the trust’s principal place of administration. A Florida resident signs a SLAT under Florida law from the start, and our dynasty trust page covers the 1,000-year term that follows.

What Does a SLAT Cost?

Designing and funding a SLAT is a flat fee quoted at consult, because the work depends on the assets, whether two trusts are needed and whether the plan includes life insurance. The fee includes the trust, the funding documents and coordination of the gift tax return with your accountant. Appraisal fees and recording costs are additional and passed through at cost. Advertised fees are honored for 90 days from the posted date.

Frequently Asked Questions

Common Situations

The business owner who wants the growth out. A husband owns an interest in a company worth $6,000,000 that he expects to grow. He gives it to a SLAT for his wife and their children, with his wife as co-trustee under a support standard and their son as independent trustee. The growth over the next 20 years stays out of both estates, and his wife can receive distributions if the family needs them.

The couple who each wanted one. A wife and husband each want a SLAT. The husband signs his in March with a brokerage account and gives his wife a power to redirect the trust among the children at her death. The wife signs hers the following year with a real estate interest, gives her husband no such power, and adds the children as current beneficiaries, so the two trusts do not mirror each other.

Sources of Law

• 26 U.S.C. §2010(c)(3)(A)-(B) (basic exclusion amount of $15,000,000, adjusted for inflation after 2026), law.cornell.edu; 26 U.S.C. §2041(b)(1)(A) (a power limited by an ascertainable standard relating to health, education, support or maintenance is not a general power of appointment).
• 26 U.S.C. §2513(a)(1) and Treas. Reg. §25.2513-1(b)(4) (gift splitting; consent effective for a third-party interest only where ascertainable and severable from the spouse’s interest).
• 26 U.S.C. §677(a) (grantor treated as owner where income may be distributed to the grantor’s spouse); 26 U.S.C. §672(e)(1)(A),(2) (grantor treated as holding interests of a person who was the spouse at the creation of the interest); 26 U.S.C. §682, repealed by Pub. L. 115-97, §11051(b)(1)(C).
• Fla. Stat. §736.0505(1)(b) (creditors of a settlor reach what can be distributed to the settlor) and (3)(a)3. (after the death of the settlor’s spouse, assets of a qualifying lifetime trust for the spouse are deemed contributed by the spouse; subject to §726.105), as amended by ch. 2022-101, Laws of Fla.
• Fla. Stat. §736.0814(2)(a),(3) (a trustee who is a beneficiary is limited to distributions for health, education, maintenance or support unless the trust expressly provides otherwise); §736.08145 (grantor trust tax reimbursement); §736.1105(2) (dissolution of marriage voids provisions for the spouse in a revocable trust); §689.225(2)(g) (1,000-year period for trusts created on or after July 1, 2022).
• Case retold below: United States v. Estate of Grace, 395 U.S. 316 (1969). Opinion read in full; retrieved September 30, 2026.

The Matched Pair of Trusts the Supreme Court Undid

In one case I have reviewed, a husband and wife signed two trusts fifteen days apart, and the fact that the trusts matched is what cost the estate.

Joseph Grace was a very wealthy man when he married in 1908, and his wife had no property of her own. Over the next 23 years he transferred a large amount of property to her, including the family’s Long Island estate, while he kept control of the family’s business affairs and she signed whatever he had prepared. On December 15, 1931, he signed a trust that paid her the income for life, allowed the trustees to give her principal, and let her direct at her death how the property would pass among him and their children. On December 30, 1931, she signed a trust that was virtually identical, for his benefit, funded with the Long Island estate and securities he had given her. One of his employees drafted both, under a plan he devised to create the trusts before a new gift tax expected the following year, and he chose the property for each. She died in 1937 and he died in 1950. The IRS included the trust she had signed in his estate and assessed an estate tax deficiency of $363,500.97. The Court of Claims ruled for his estate. The Supreme Court reversed in 1969, holding that two interrelated trusts that leave each spouse in about the same economic position are uncrossed, whatever the couple intended.

My reading of that case is that the couple did nothing unusual for their time except make the trusts alike, and alike was enough. Couples ask for two SLATs because two trusts feel fair, and in reviewing the reciprocal trust decisions I have a few take-home points.

The first is timing. The Grace trusts were signed fifteen days apart under one plan. Two SLATs signed months or a year apart, each for its own reasons, look like two decisions rather than one.

The second is the terms. The Grace trusts gave each spouse the same income, the same access to principal and the same power at death. Avoid giving the two beneficiary spouses matching rights, because the economic position of each spouse is what the doctrine compares.

The third is the property. He picked the assets for both trusts from one pool he controlled. Funding each SLAT from the spouse’s own separate property, in different amounts, gives each trust a separate history.

An owner can build these differences in at the drafting stage, and a single SLAT avoids the question entirely. One limit is worth stating plainly. No court has published a bright-line test for how different two trusts must be, so every pair is judged on its own facts.

Kevin D. Klagge, Esq., admitted in Florida since 2012. The case described above is a decision of the Supreme Court of the United States rather than a matter handled by this firm. Past results do not guarantee a similar outcome.

Updated on September 30, 2026. Reviewed by Kevin D. Klagge, Esq., Fla. Bar No. 99502. Attorney Kevin Klagge represents families, businesses, and international clients in estate and tax planning, business structuring, and international law, with a focus on Florida legal tools. He litigates estate and business issues in court. General information about federal and Florida law, not legal or tax advice, and no attorney-client relationship is created. Do not send confidential information until we have agreed to represent you.