A long time ago, lawmakers were concerned about the ability of one wealthy person to control how assets were managed after they passed away. In English common law, a host of complicated rules were developed to make it so that assets could no longer be controlled from the grave and that heirs were given full control.
These rules became part of the laws in the U.S. after the revolution. Today, however, their biggest impact is typically in the headaches they cause law students who must learn them. The old rules have steadily been replaced.
Today, there is a type of trust that can last indefinitely to pass money down between generations of a family. With the raising of the gift and estate taxes, these “dynasty trusts” could be a great deal for many wealthy people, as Bloomberg discusses in "Heirs of Heirs of Heirs of Heirs Love Dynasty Trusts."
Married couples can put up to just over $22 million into a dynasty trust today, without a tax penalty. If those assets are invested wisely, the proceeds from the investments can be used by the family for a long time, perhaps even forever.
Heirs do not have to pay any capital gains on the trust assets until an asset is sold. However, they most likely will likely be required to pay income taxes on any distributions.
People with enough money to create a dynasty trust might want to consider the option, while they have it. However, these trusts are only available in a few states, so it is important to set it up where it is legal.
Reference: Bloomberg (June 10, 2018) "Heirs of Heirs of Heirs of Heirs Love Dynasty Trusts."