1. Short title This Act may be cited as the Getting Rid of Abusive Trust Schemes Act or the GRATS Act . 2. Required minimum 15-year term, etc., for grantor retained annuity trusts (a) In general Subsection (b) of section 2702 of the Internal Revenue Code of 1986 is amended— (1) by redesignating paragraphs (1), (2), and (3) as subparagraphs (A), (B), and (C), respectively, and by moving such subparagraphs (as so redesignated) 2 ems to the right, (2) by striking For purposes of and inserting the following: (1) In general For purposes of , (3) by striking paragraph (1) or (2) in paragraph (1)(C) (as so redesignated) and inserting subparagraph (A) or (B) , and (4) by adding at the end the following new paragraph: (2) Additional requirements with respect to grantor retained annuity trusts For purposes of subsection (a), in the case of an interest described in paragraph (1)(A) (determined without regard to this paragraph) which is retained by the transferor, such interest shall be treated as described in such paragraph only if— (A) the right to receive the fixed amounts referred to in such paragraph is for a term of not less than 15 years and not more than the life expectancy of the annuitant plus 10 years, (B) such fixed amounts, when determined on an annual basis, do not decrease during the term described in subparagraph (A), and (C) the remainder interest has a value, as determined as of the time of the transfer, which is— (i) not less than an amount equal to the greater of— (I) 25 percent of the fair market value of the property transferred to the trust, or (II) $500,000, and (ii) not greater than the fair market value of the property transferred to the trust. . (b) Effective dates The amendments made by this section shall apply— (1) to trusts created on or after the date of enactment of this Act, and (2) to any portion of a trust established before the date of the enactment of this Act which is attributable to a contribution made on or after such date. 3. Certain transfers between grantor trust and deemed owner