Recently a lot was made of the fact that Barron Hilton of Hilton Hotels announced that he was donating 97 percent of his estimated $2.3 billion fortune to charity.  The Conrad N. Hilton Foundation made the announcement indicating that it was to be the recipient of the monies.

Many articles took the position that Paris was losing out.  Some articles indicated that Barron Hilton is not all that happy with his granddaughter.  The implication being that she lost out on an inheritance due to her behavior.

It is likely that Mr. Hilton’s estate planning had nothing to do with his granddaughter and more than a fair amount to do with estate taxes.  By giving his money to a Foundation that his son Steve is president and chief executive of, he allows the family to control the money for a long time, avoids estate taxes and in the case of his grandchildren, avoids the generation skipping tax in addition to the estate tax.