This bill significantly amends the Internal Revenue Code regarding grantor trusts, introducing stricter requirements for Grantor Retained Annuity Trusts (GRATs) . It mandates that the right to receive fixed annuity amounts must be for a term of not less than 15 years and not more than the annuitant's life expectancy plus 10 years. Furthermore, these annuity amounts cannot decrease during the trust term, and the remainder interest must have a value of at least the greater of 25% of the transferred property's fair market value or $500,000, but not exceeding the full fair market value. The legislation also redefines the tax treatment of transfers between a grantor trust and its deemed owner. Such transfers for consideration, including the satisfaction of an annuity or discharge of debt, will now be treated as a sale or exchange for tax purposes , regardless of the deemed owner status. Exceptions apply to fully revocable grantor trusts and asset-backed securities trusts, and the bill also classifies a grantor trust and its deemed owner as related parties for certain tax provisions. Finally, the bill addresses the payment of taxes on grantor trust income. It stipulates that an amount equal to the taxes paid by a deemed owner on the income of an applicable grantor trust (one not fully revocable) will be treated as a taxable gift. This provision does not apply if the trust reimburses the deemed owner for the tax payment within the same calendar year, and it includes conforming amendments to deny charitable and marital deductions for such deemed gifts. These changes generally apply to trusts created or transfers made on or after the bill's enactment date.