The BDOT Option for Trusted Beneficiaries
The Beneficiary Deemed Owner Trust (BDOT) is one of several options to consider for “trusted beneficiaries” (pun intended) to whom you are open to giving some access to trust income and/or principal. (Another option might be the Beneficiary Controlled...It Pays to Be Ruthless When Killing GRATs
Using quantitative analysis, we’ll show that the grantor’s choice is almost always clear: If her two-year GRAT is funded with marketable securities and is underwater at all prior to the first annuity date, she should cut her losses and start a new GRAT. That...Warren’s Wealth Tax Unconstitutional
While the estate tax is a perennial boomerang, Warren’s wealth tax tomahawk chop flies in the face of the Constitution’s prohibition on unapportioned scalping: The Constitution prohibits federal direct taxes that are not apportioned by population,...HEET Trust Can Avoid GST Tax Heat, Teach Grandkids How to Pack Heat, and Help the NRA too!
Our Firearms Instruction and Responsible Stewardship Trust (F.I.R.S.T. Family Trust) takes many forms as it is custom like all our planning, but one variant involves a Health and Education Exclusion Trust. This type of trust allows you to give much greater...FPC 20180313: Flexibility to Avoid Taxes & Gun Control
When it comes to taxes and gun control, it’s hard to keep up with Sacramento and DC. One way is to have your estate planning attorney on speed dial. A smarter way is to have that attorney draft with flexibility in mind, so you can have peace of mind. We’ll focus...Clawback Under New Tax Law
Under either formulation of purpose, that is, the “unified” approach or the “fairness” approach, in issuing its regulations, the IRS would be compelled to use the basic exclusion amount in effect the time of the decedent’s death for purpose of computing the...Tax Act Signed — what does it mean for Estate Planning?
The Tax Cuts and Jobs Act((In both the House and Senate versions, the bill was called the “Tax Cuts and Jobs Act.” Due to a last-minute change in response to a procedural issue, the official title was changed to “To provide for reconciliation pursuant to titles...A modest proposal re estate tax: Get self-defense training!
The expected new Tax Cut and Jobs Act (not the official title anymore, but i’m sticking with it) doubles the applicable exclusion amount for estate tax but reverts to current law on January 1, 2026. That sunset provision reminds me of this funny old video...House GOP Tax Plan Avoids Carryover Basis Regime
So far, the House GOP’s proposed tax plan avoids the carryover basis regime that would have been necessary if it would have imposed a capital gains tax at death to replace the estate and generation skipping transfer taxes, as the Trump campaign seemed to favor....Rev Proc 2017-34 simplifies getting extension for portability election
Rev. Proc. 2017-34 SECTION 1. PURPOSE This revenue procedure provides a simplified method for certain taxpayers to obtain an extension of time under § 301.9100-3 of the Procedure and Administration Regulations to make a “portability” election under §...Trump’s Tax Plan Raises Questions for Estate Planners
The tenuousness of the President’s plan raises a whole host of additional questions. These include: (1) whether the President’s plan would be coupled with a step-up in basis at death versus carryover basis (carryover basis would effectively increase total taxes...Ten Estate Planning Strategies While Waiting for Tax Reform
The election of Donald J. Trump to the presidency and Republican control of both houses of Congress make estate tax reform extremely probable in the next two years. However, given the new administration’s other proclaimed priorities, including the repeal of...IRS Recognizes Retroactive Validity of GRAT Based Upon Court Reformation
In this matter, the draftsman failed to include language prohibiting the trustee from issuing a note, other debt instrument, option or other similar financial arrangement in satisfaction of the annuity obligation as required by § 25.2702-3(d)(6) of the Gift Tax...Estate Planning Pitfall: You reside in a state with high estate tax
Sacramento is at this moment plotting to bring back the estate tax here. Also, you might own property, or plan to retire, in one of these states. Do you have a flexible estate plan? Reforms being debated by Congress could repeal the federal estate tax with...Conflicted Art Appraisals Lead to $1.77 Million Estate Tax Deficiency
Recently, in Estate of Kollsman v. Commissioner (T.C. Memo. 2017-40), the U.S. Tax Court held that an art collector’s estate significantly underreported the value of two artworks for estate tax purposes. The problem: the estate relied on appraisals by an...Dynastic Gamesmanship: Did David Rockefeller’s Crafty Trust Work Leave the IRS Holding the Bag?
The trust rules have evolved over the last eight decades. For one thing, depending on the state, a trust created now for David’s own grandchildren and beyond may never need to terminate.It could theoretically run forever, eternally beyond IRS reach if run...Tax Reform Bill On the Front Burner
In short, the ground has been laid for quick action in the House of Representatives the moment the health care debate concludes. Source: Tax Reform Bill On the Front BurnerCharitable Divorce Planning?
Charitable planning coordinated with dissolution planning merits serious examination. The work involved is well worth the effort to assure divorcing parties have maximized the use of all marital assets in a tax-efficient manner. The four techniques are...Tax Law Update: April 2017
The loss of income tax revenue would be the product of income tax saving strategies that would become viable in the wake of gift tax elimination. For example, without a gift tax, the use of a “straw taxpayer” would likely become a prevalent income tax planning...
Free to Advisors
