Recent developments in estate planning

The estate planning landscape is constantly evolving, and recent developments may affect existing and future estate planning strategies. This annual update summarizes key changes advisers need to be aware of to ensure their clients’ estate plans remain effective and in line with their intentions. The update covers developments in the estate planning area from July 2023 through June 2024.

Potential sunset of higher estate/gift and GST exemptions

The impending sunset of the current estate, gift, and generation-skipping transfer (GST) tax exemptions at the end of 2025 is a critical issue for estate planners and their clients. The Tax Cuts and Jobs Act (TCJA)¹ significantly increased these exemptions, allowing individuals to transfer up to $13.61 million and married couples up to $27.22 million over their lifetimes as of 2024 without incurring federal estate or gift taxes. However, unless Congress acts to extend these provisions, the exemptions will revert to their pre-TCJA levels of $5 million per individual and $10 million per married couple, adjusted for inflation, starting Jan. 1, 2026.

Given this looming deadline, it is imperative for estate planners to engage with their clients now to discuss potential strategies for using the current higher exemptions. The urgency resembles the historical precedent of increased gifting activity in the face of similar scheduled sunsets, such as in 2012. Where the anticipated sunset ultimately did not occur.² Planners should caution against overcommitting to strategies that assume the sunset will occur. If Congress extends the higher exemptions, clients who have made large gifts may find they have unnecessarily depleted their available exemptions. Therefore, flexibility in planning is key, such as by drafting documents now and waiting to make transfers when there is more certainty about the probability of the sunset. This may ensure that clients can adapt to legislative changes while still taking advantage of the current favorable tax environment.³

Inflation adjustments

The IRS released Rev. Proc. 2023-34, which set forth 2024 inflation adjustments for the following estate planning-related items:

• Unified credit against estate tax: The basic exclusion amount is $13,610,000 for determining the amount of the unified credit against estate tax under Sec. 2010.
• Valuation of qualified real property in decedent’s gross estate: If the executor elects to use the special-use valuation method under Sec. 2032A for qualified real property, the aggregate decrease in the value of the qualified real property resulting from electing to use Sec. 2032A for purposes of the estate tax cannot exceed $1,390,000.
• Gift tax annual exclusion: The gift tax annual exclusion for gifts of a present interest is $18,000. The gift tax annual exclusion for gifts of a present interest to a spouse who is not a U.S. citizen is $185,000. 
• Interest on a certain portion of estate tax payable in installments: The dollar amount used to determine the “2% portion” is $1,850,000.

The increased basic exclusion amount allows taxpayers greater flexibility in gifting assets during their lifetime. For decedents dying and gifts given in 2024, the basic exclusion rose by $690,000 compared with 2023, opening the doors for additional planning. Advisers can expect another increase in 2025 prior to the Jan. 1, 2026, scheduled sunset. Additionally, the inflation adjustments to the GST exemption can be advantageous. Taxpayers also can leverage the inflation increases for late allocation to trusts that are not fully GST-exempt.

Estate and gift provisions in the most recent Greenbook

The Greenbook, issued annually by Treasury, provides a detailed account of the current administration’s revenue proposals, offering a glimpse into its policy priorities and legislative intentions. For estate planners, the most recent Greenbook, released on March 11, 2024, provides significant insights into potential changes in estate and gift tax provisions, identifying conceivable future legislation that could affect planning strategies.⁴ The following proposals are included:

• Impose a 25% minimum income tax on taxpayers with greater than $100 million in wealth;
• Require reporting of estimated total value of trust assets and other information about the trust, including the inclusion ratio in certain circumstances;
• Require that a defined value formula clause be based on a variable that does not require IRS involvement;
• Cap the gift tax annual exclusion at $50,000 per donor, indexed for inflation after 2025, and remove the present-interest requirement;
• Modify tax rules for grantor retained annuity trusts to require the remainder interest to have a minimum value for gift tax purposes equal to the greater of 25% of the value of the assets transferred or $500,000, but not more than the value of the assets transferred;
• Treat transactions between grantors and their grantor trust as regarded for income tax purposes;
• Provide that the payment of income tax on the income of a grantor trust is a gift;
• Redetermine a trust’s GST inclusion ratio on certain transactions, including decanting and sales between a GST-nonexempt and a GST-exempt trust;
• Treat loans made by a trust to a trust beneficiary as a distribution for income tax purposes;
• Revise rules for valuation of promissory notes and fractional interests; and
• Revise the definition of a “guaranteed annuity” from a charitable lead annuity trust to require that the value of the remainder interest be at least 10% of the value of the property transferred.

While the current increased exemption amounts offer valuable planning opportunities, the Greenbook sheds light on potential changes that could significantly affect these strategies in the coming years. Estate planners should closely monitor legislative developments and adapt their recommendations accordingly to ensure clients’ estate plans remain effective in the evolving tax landscape.

Key items in the IRS Priority Guidance Plan

The 2023–2024 Priority Guidance Plan outlines key tax issues that Treasury and the IRS will address through various forms of published administrative guidance, including regulations and revenue rulings. For estate and gift tax planning, several items are particularly relevant:

• Regulations under Sec. 645 pertaining to the duration of an election to treat certain revocable trusts as part of an estate;
• Final regulations under Secs. 1014(f) and 6035 regarding basis consistency between an estate and a person acquiring property from a decedent;
• Regulations under Sec. 2010 addressing whether gifts that are includible in the gross estate should be excepted from the special rule of Regs. Sec. 20.2010-1(c);⁵
• Regulations under Sec. 2032(a) regarding imposition of restrictions on estate assets during the six-month alternate valuation period;
• Final regulations under Sec. 2053 regarding the deductibility of certain interest expenses and amounts paid under a personal guarantee, certain substantiation requirements, and the applicability of present-value concepts in determining the amount deductible; and
• Regulations under Sec. 2632 providing guidance governing the allocation of GST exemption in the event the IRS grants relief under Sec. 2642(g), as well as addressing the definition of a GST trust under Sec. 2632(c) and providing ordering rules when GST exemption is allocated in excess of the transferor’s remaining exemption.

New final GST exemption regulations

Final regulations have been issued providing guidance on when, and how, taxpayers can obtain an extension of time to make certain GST exemption allocations and elections under Sec. 2642(g) (1).⁶ On and after May 6, 2024, relief under Sec. 2642(g)(1) no longer will be granted under Regs. Sec. 301.9100-3. Private letter ruling relief will instead be granted under Regs. Sec. 26.2642-7. While the proposed regulations prohibited relief to revoke a prior GST election,⁷ the final regulations removed this language, potentially allowing relief to revoke a prior erroneous GST “optin” or “opt-out” election.

Further, the final regulations provide additional details related to affidavits when requesting private letter ruling relief for GST purposes. The relief request process still requires a private letter ruling in most situations, and the user fee will likely be the same as for Regs. Sec. 301.9100-3 requests. Generally, to receive relief, the taxpayer must show that they acted reasonably and in good faith, that they are not attempting to benefit from hindsight, and that it would not prejudice the interests of the government if relief were granted.

Proposed foreign trust regulations

The IRS released proposed regulations on reporting transactions with foreign trusts.⁸ These regulations clarify existing guidance but do not introduce major changes. They confirm reporting requirements for distributions, contributions, and loans involving foreign trusts. While some relief is offered for reporting certain pensions, broader penalty relief for reasonable-cause delinquencies is not included.

Increase in estate and gift filings and IRS examinations

The annual IRS Data Book offers a wealth of information and provides valuable insights into IRS enforcement activities, including audit rates and revenue collected from estate and gift taxes. The most recent IRS Data Book for the fiscal year ending Sept. 30, 2023, reveals a significant increase in estate- and gift-related filings in 2023 compared with 2022. Fiduciary income tax returns associated with trusts and estates saw a rise of over 13%.⁹ Even more dramatic is the increase in 706-series forms. Estate tax and GST tax returns rose from 27,088 in 2022 to 49,633 in 2023, an 83% increase.¹⁰ Gift tax filings climbed from 270,142 in 2022 to 516,991, a 91% increase.¹¹

This surge suggests many taxpayers are taking proactive steps in estate planning, possibly due to concerns about the potential sunset of the current high estate and gift tax exemption. However, the increase in filings also presents a potential opportunity for the IRS. With more estate and gift tax returns on the table, the agency may see a ripe area for examination and potential tax revenue collection.

Anecdotally, the authors have seen a rise in estate and gift tax audits. The IRS Data Book reports on closed examinations, meaning audits that have concluded. This means that the data does not reflect the many ongoing audits for recent tax years. The most recent data only reports on tax years 2013–2021. Out of the 32,374 series 706 estate and GST tax returns filed for the 2021 tax year, only 10 of the 158 returns examined (of which 135 examinations were still in process) had resulted in no change.¹²

IRS guidance on related-party basis shifting and irrevocable grantor trusts

In an effort to crack down on tax-avoidance strategies, Treasury and the IRS issued a package of guidance on June 17, 2024, targeting “basis-shifting” transactions used by related parties. The first item in the package was Notice 2024-54, which announced that the IRS will propose two sets of regulations that aim to prevent tax-avoiding basis-shifting maneuvers within partnerships involving related parties (covered transactions). In the first set, the IRS intends to propose regulations under Secs. 732, 734(b), 743(b), and 755 that would (1) provide the required method of recovering adjustments to the bases of property held by a partnership, property distributed by a partnership, or both, arising from covered transactions; (2) provide rules governing the determination of gain or loss on the disposition of such basis-adjusted property; and (3) include similar transactions involving tax-indifferent parties (for example, certain foreign persons, a tax-exempt organization, or a party with tax attributes that make it tax-indifferent) rather than related parties. In the second set, the IRS intends to propose regulations that would provide for single-entity treatment of members that are partners in a partnership, so that covered transactions cannot shift basis among group members and distort group income.

The second item in the package is proposed regulations¹³ that would flag certain partnership transactions involving related parties for closer scrutiny by identifying them as transactions of interest, a type of reportable transaction. The transactions being identified in the proposed regulations include certain transactions involving partnership interests held by grantor trusts.

The last item in the package is Rev. Rul. 2024-14, in which the IRS ruled that certain related-party partnership transactions involving basis shifting, where the goal is simply to shift tax burdens rather than achieve a genuine economic purpose, lack economic substance under Sec. 7701(o).

This guidance comes after Rev. Rul. 2023-2. In that ruling, the IRS clarified that where a taxpayer creates an irrevocable trust, retaining a power that causes the taxpayer to be the owner of the entire trust for income tax purposes, but does not cause the trust assets to be included in the taxpayer’s gross estate and funds the trust with assets in a transaction that is a completed gift for gift tax purposes, the bases of the assets are not stepped up to fair market value (FMV) under Sec. 1014 at the taxpayer’s death because the assets were not acquired or passed from a decedent (as defined in Sec. 1014(b)). While the ruling itself was not surprising, it fueled concerns about potential future restrictions on grantor trusts.¹⁴

When advising clients on grantor trusts or related-party basis-shifting techniques, advisers should be sure to discuss the possibility of future regulatory changes that could reduce their effectiveness.

Landmark transferee liability decision: Estate of Paulson

A case appealed to the Ninth Circuit, Paulson,¹⁵ centered on determining who would ultimately be personally liable for unpaid federal estate taxes. The IRS had pursued collection efforts against various parties, including the decedent’s surviving spouse, beneficiaries, trustees, and the executor of the decedent’s estate.

The Ninth Circuit held that Sec. 6324(a)(2) imposes personal liability for unpaid estate taxes on the categories of persons listed in the statute (generally, recipients of nonprobate property) who receive property included in the gross estate or have possession of such property on the date of death. The court also held that the defendant successor trustees and trust beneficiaries in the case were within the categories of persons listed in Sec. 6324(a) and were personally liable for unpaid estate taxes, a holding that extended transferee liability further than in prior cases.

The majority opinion included a lengthy explanation to justify the court’s conclusion and was followed by a strongly worded dissent. Prior to this decision, courts historically had concluded that the statute applied only to persons in actual possession of assets on the date of death or those with an immediate right to such assets (for example, the beneficiary of a life insurance policy), and not those who took possession at some time in the future. This interpretation was rejected by the Ninth Circuit, and although the decision was appealed to the U.S. Supreme Court, certiorari was denied in March 2024.¹⁶

This case highlights the extent of potential personal liability for those serving in fiduciary roles, as well as those who inherit assets, when unpaid claims to the U.S. government have not been prioritized. Planners should strongly advise their clients of these potential liabilities when accepting a fiduciary role and encourage waiting for an IRS closing letter before distributing estate assets.

Life insurance valuation issues: DeMatteo

DeMatteo,¹⁷ a stipulated decision in Tax Court in early 2024, settled a dispute involving the determination of the proper valuation of a life insurance policy for gift tax purposes. Previously in the case, the Tax Court had denied the taxpayer’s request for partial summary judgment on the question of whether the interpolated terminal reserve (ITR) value was required to be used for gift tax reporting purposes.¹⁸ The taxpayer argued that the IRS regulation governing the valuation of transfers of life insurance does not require that the determination be based on the ITR.¹⁹ The Service disagreed with this interpretation and argued it is mandatory for the value to be determined using the ITR, referring to it as “the universal method” for valuing similar life insurance policies.

Life insurance products have grown in complexity over the years, and some practitioners are finding that the ITR may not always reflect FMV. The settlement likely considered both the IRS’s valuation and the taxpayer’s valuation to reach a mutually agreeable compromise. The main takeaway of this case is that planners should be cautious when clients transfer existing life insurance policies and believe the gift tax value should not be based on the ITR.

Life insurance and redemption agreements: Connelly

In Connelly,²⁰ an estate tax case, the Supreme Court affirmed an Eighth Circuit decision involving a company’s obligation to redeem a deceased owner’s shares. Two brothers, Michael and Thomas Connelly, who jointly owned a building supply corporation, Crown, entered into an agreement that upon either brother’s death, the corporation would be required to redeem (i.e., purchase) the decedent brother’s shares under certain circumstances. To ensure that the corporation would have enough money to redeem the decedent brother’s shares if it was required, the corporation obtained $3.5 million in life insurance on each brother.

After Michael died in 2013, Crown received the life insurance proceeds from its policy on him. On the estate tax return filed for Michael’s estate for 2014, the value of the proceeds from the life insurance policy were offset by the corresponding redemption obligation, therefore reducing the estate tax value of Michael’s shares in the corporation.

The Eighth Circuit held that the proceeds from the life insurance policy used to fund the redemption obligation should be included for purposes of determining the estate tax value of Michael’s shares without a reduction for the redemption obligation. The holding by the Eighth Circuit was inconsistent with the holding of the Eleventh Circuit in Estate of Blount.²¹ In Blount, the Eleventh Circuit held that life insurance proceeds were offset by the contractual obligation to fund a redemption obligation for purposes of determining a company’s value for estate tax purposes. The split between the circuits led the Supreme Court to grant certiorari in Connelly in December 2023, and in June 2024 Justice Clarence Thomas delivered the Court’s unanimous opinion.

The Court affirmed the Eighth Circuit’s decision, holding that a corporation’s contractual obligation to redeem shares did not offset the value of life insurance proceeds committed to funding the redemption.

The Court reasoned that the estate would not have sold to a hypothetical nonfamily buyer for the amount reported on the estate tax return. It further reasoned that the company’s requirement to purchase the shares had no effect on any shareholder’s economic interest. The Court also took issue with the fact that the estate’s argument assumed the company had the same FMV before and after the redemption, even though it had received $3.5 million of life insurance proceeds.

Following the Connelly decision, advisers should carefully review redemption buy-sell agreements with their clients and consider alternative structures in order to avoid a similar result.

Buy-sell agreement special valuation rules: Huffman

Sec. 2703 describes certain rights and restrictions that are disregarded when valuing property. Sec. 2703(a)(1) provides that the value of any property must be determined without regard to “any option, agreement, or other right to acquire or use the property at a price less than the fair market value of the property (without regard to such option, agreement, or right).” Sec. 2703(a)(2) includes any restriction on the right to sell or use such property. Sec. 2703(b) provides an exception to Sec. 2703(a) for any option, agreement, right, or restriction if (1) it is a bona fide business arrangement; (2) it is not a device to transfer such property to members of the decedent’s family for less than full and adequate consideration in money or money’s worth; and (3) its terms are comparable to similar arrangements entered into by persons in an arm’s-length transaction.

In Huffman,²² the Tax Court considered whether a buy-sell agreement to purchase shares in a family-owned aerospace company between a son and his parents’ trust and his mother’s S corporation should be taken into account in determining the value of the company shares the son bought. The court determined that the agreement’s terms were not comparable to similar arrangements entered into by persons in arm’s-length transactions. Thus, the agreement did not meet the third requirement of Sec. 2703(b), and it was disregarded in determining the value of the shares in the company.

Disregarding the agreement, the court determined that the value of the shares was much higher than the amount the son paid for them and that the difference between their value and the amount paid was a deemed gift from his parents subject to gift tax. This case underscores the importance of ensuring that buy-sell agreements meet the specific requirements of Sec. 2703 to avoid unfavorable tax consequences.

Potential gift tax implications after trust modification allowing for reimbursement of taxes paid by grantor: CCA 202352018

In Chief Counsel Advice (CCA) 202352018, the IRS concluded that modifying a grantor trust to add a tax reimbursement clause constituted a taxable gift by the consenting trust beneficiaries to the grantor, because the addition of a discretionary power to distribute income and principal to the grantor was a relinquishment of a portion of the beneficiaries’ interest in the trust.

This new position contradicts a previous IRS letter ruling from 2016 that allowed such modifications without triggering gift tax.23 The IRS acknowledged this inconsistency and clarified in the CCA that the letter ruling no longer reflects its official position. The CCA offers limited guidance on valuing the deemed gift, suggesting that the value could be equal to the entire value of the trust, which could have significant tax implications.

Advisers should exercise caution when advising clients on trust modifications involving beneficiary consent or lack of objection.²⁴

Termination of QTIP trust did not trigger deemed gift: Estate of Anenberg

On May 20, 2024, the Tax Court issued a significant opinion in Estate of Anenberg,²⁵ determining that the termination of a qualified terminable interest property (QTIP) trust by the surviving spouse and distribution of its assets to her did not trigger a gift tax liability for her estate under Sec. 2501.

The Tax Court held that, even if there was a transfer of property under Sec. 2519, the estate was not liable for gift tax because the surviving spouse received back the interests in property that she was treated as holding and transferring under Secs. 2056(b)(7)(A) and 2519 and made no gratuitous transfer, as required by Sec. 2501. The court’s holding contrasts sharply with the IRS’s stance in CCA 202118008, in which it advised that the termination of a QTIP trust where assets were distributed to the surviving spouse would result in estate inclusion and separate gift transfers, including by the spouse under Sec. 2519 and by the remainder beneficiaries under Sec. 2511, which do not offset each other.

The IRS’s position in Anenberg focused on whether the surviving spouse made a gift and did not address whether the remainder beneficiaries’ consent to the termination constituted a gift. This omission may come as a surprise to some when compared to the conclusions the IRS reached in a different context in CCA 202352018 (described above), which determined that modifying a grantor trust to add a tax reimbursement clause constituted a taxable gift by the consenting trust beneficiaries. In Anenberg, the IRS made no similar argument, although the court acknowledged in a footnote that it was not expressing a view on whether the remainder beneficiaries could be treated as making a gift to the surviving spouse.

The Anenberg decision clarifies that properly documented and structured sales of assets from QTIP marital trusts may not trigger gift tax liabilities, so long as no gratuitous transfers occur. However, the decision could be appealed, and the upcoming McDougall case²⁶ will further analyze QTIP trust terminations. Advisers should closely monitor these cases and exercise caution when planning with QTIP trusts.

Charitable planning: Hoensheid

In Estate of Hoensheid,²⁷ the Tax Court decided whether the anticipatory-assignment-of-income doctrine applied to a taxpayer’s donation of stock in his closely held corporation to a donoradvised fund. Under the doctrine, a donor is deemed to have effectively realized income and then assigned it to another when the donor has a fixed right to the unpaid income. In general, where there is a contribution of appreciated stock followed by a sale of stock by the donee, a donor’s right to the income from the sale is fixed if the sale is virtually certain to occur at the time of the gift.

In Hoensheid, the taxpayer donated stock in his closely held corporation to a donor-advised fund but waited until two days before the sale to transfer stock to the fund. The Tax Court found that delaying the transfer until that time made the sale a virtual certainty at the time the stock was donated. Therefore, the anticipatory-assignment-of-income doctrine applied, and the taxpayer recognized gain on the sale of the donated stock.

The donor ignored the advice of legal counsel that the transfer of shares to the donor-advised fund should occur well before the sale agreement was in place. Correspondence between the donor and his advisers reflected an intent to only transfer shares to avoid gain recognition and no desire to transfer shares if the sale would not occur. The court held that the transfer was a gift to charity, and, although the gift was an assignment of income, the taxpayer was potentially entitled to a charitable contribution deduction. However, the court further held that the taxpayer failed to comply with the charitable contribution substantiation requirements by not obtaining and attaching a qualified appraisal, so the taxpayer’s charitable contribution deduction was denied.

As this case demonstrates, practitioners should be mindful of the anticipatory-assignment-of-income doctrine and charitable substantiation requirements when advising clients regarding donations of property to charitable organizations.

Bona fide debt vs. gift: Estate of Bolles

The recent case of Estate of Bolles²⁸ highlights key factors in determining whether advances to family members are loans or taxable gifts. In this case, a mother advanced funds to her son from 1985 to 2007 to keep his architectural practice afloat. The Tax Court determined the character of the advances using the traditional factors used to decide whether an advance is a loan or a gift. These factors include the repayments made, expectations of repayment, and the borrower’s ability to repay. The Tax Court held that the advances from 1985 to 1989 were loans, but the advances from 1990 through 2007 were gifts.

The Ninth Circuit affirmed the Tax Court. It found that the Tax Court reasonably determined that the advances made from 1985 to 1989 were loans because the mother had a real expectation that her son would repay the advances. However, the Ninth Circuit found that after 1989, the facts indicated that the circumstances surrounding the advances had changed. During those years, the son made no repayments of the advances and signed an agreement acknowledging he had “neither the assets nor the earning capacity” to make repayments. Further, in late 1989, the mother excluded the son from receiving assets from her personal trust at her death. Thus, the Tax Court had reasonably concluded that there was not a bona fide creditor-debtor relationship between the mother and the son for the period of 1990–2007, so the advances during this period were gifts.

This case serves as a reminder for families with outstanding intrafamily loans to carefully document the terms of the loans, ensure they are commercially reasonable, and enforce the terms of the loan agreement.

Review plans for potential developments

The estate planning items discussed above underscore the need for tax advisers to engage with their clients. By proactively reaching out and highlighting the potential impact of recent developments on clients’ estate planning strategies, advisers can demonstrate valuable foresight and solidify their role as a trusted adviser.

Footnotes

¹The Tax Cuts and Jobs Act, P.L. 115-97.

²The American Taxpayer Relief Act of 2012, P.L. 112-240, permanently extended provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001, P.L. 107-16, and the Jobs and Growth Tax Relief Reconciliation Act of 2003, P.L. 108-27, past a “fiscal cliff” sunset date of Dec. 31, 2012, including a higher estate and gift tax exclusion amount.

³See also Strausfeld, “Prepare Large Estates for TCJA Sunset Now,” Journal of Accountancy (May 7, 2024).

⁴Department of the Treasury, General Explanations of the Administration’s Fiscal Year 2025 Revenue Proposals (March 11, 2024).

⁵Special rule in the case of a difference between the basic exclusion amount applicable to gifts and that applicable at the donor’s date of death.

⁶T.D. 9996, 89 Fed. Reg. 37116.

⁷Prop. Regs. Sec. 26.2642-7(e)(1), REG-147775-06, issued in 2008.

⁸REG-124850-08, 89 Fed. Reg. 39440.

⁹IRS Data Book, 2023, Table 2, Number of Returns and Other Forms Filed, by Type, Fiscal Years 2022 and 2023.

¹⁰Id.

¹¹Id.

¹²IRS Data Book, 2023, Table 17, Examination Coverage and Recommended Additional Tax After Examination, by Type and Size of Return, Tax Years 2013–2021.

¹³REG-124593-23, 89 Fed. Reg. 51476.

¹⁴See Ransome, “Recent Developments in Estate Planning: Part 1,” 54-10 The Tax Adviser 26 (October 2023), and Carlson, “Rev. Rul. 2023-2’s Impact on Estate Plans,” 54-11 The Tax Adviser 8 (November 2023).

¹⁵Paulson, 68 F.4th 528 (9th Cir. 2023).

¹⁶Paulson, No. 23-436 (U.S. 3/4/24) (cert. denied).

¹⁷DeMatteo, No. 3634-21 (T.C. 2/22/24) (stipulated decision).

¹⁸DeMatteo, No. 3634-21 (T.C. 7/21/22) (order denying summary judgment).

¹⁹Regs. Sec. 25.2512-6(a).

²⁰Connelly, No. 23-146 (U.S. 6/6/24).

²¹Estate of Blount, 428 F.3d 1338 (11th Cir. 2005).

²²Huffman, T.C. Memo. 2024-12.

²³IRS Letter Ruling 201647001.

²⁴See also McGrenera, Hinson, and Cain, “Recent CCA Raises Concerns for Irrevocable Grantor Trust Modifications,” 55-6 The Tax Adviser 44 (June 2024).

²⁵Estate of Anenberg, 162 T.C. No. 9 (2024).

²⁶McDougall, Nos. 2458-22, 2459-22, and 2460-22 (T.C. 2/18/22) (petitions filed).

²⁷Estate of Hoensheid, T.C. Memo. 2023-34.

²⁸Estate of Bolles, No. 22-70192 (9th Cir. 4/1/24), aff’g T.C. Memo. 2020-71.

Contributors

Carol Warley, CPA/PFS, J.D., is a partner at RSM US LLP in Houston; Amber Waldman, CPA, M.Acc., is an estate and gift senior director with RSM US LLP in McLean, Va.; and Tandilyn Cain, CPA, MST, CFP, is a senior manager with RSM US LLP in Seattle. Warley is chair of the AICPA Trust, Estate, and Gift Tax Technical Resource Panel. For more information about this article, contact thetaxadviser@aicpa.org.

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