To minimize the value of a gift a client wanted to make to his children, we established a grantor retained annuity trust (GRAT). We structured the term of years of and annuity payments from the GRAT so that the value of the remainder interest of the GRAT was near zero. The appreciation of the assets inside the GRAT have significantly exceeded the 7520 rate in effect at the time the GRAT was established. We anticipate that after the GRAT terms end, the children will receive approximately $250,000 each, effectively allowing the client to make a significant gift to his children without making a taxable gift.