Strategies for optimal intergenerational wealth transfer may require reconsideration, given the continuation of a higher basic exclusion amount by the law known as the One Big Beautiful Bill Act.
Advertisement
TOPICS
Taxation of Estates & Trusts
Considerations for intergenerational split-dollar arrangements
Families with significant estate tax exposure may consider intergenerational split-dollar (IGSD) arrangements, where the senior generation loans funds to a trust to purchase life insurance on children for the benefit of grandchildren.
Trust distributions in kind and the Sec. 643(e)(3) election
This article explores the strategic use of this election, highlighting its potential to optimize tax outcomes for both trusts and beneficiaries while cautioning against its pitfalls.
Estate of McKelvey highlights potential tax pitfalls of variable prepaid forward contracts
A taxpayer’s extension of variable prepaid forward contracts resulted in a constructive sale and a termination of obligations that gave rise to taxable gain, the Tax Court held.
Recent developments in estate planning
This annual update on trust, estate, and gift taxation covers recent IRS guidance and administrative issuances, relevant legislative proposals, and selected court decisions for the period ending June 2025.
Guidance on research or experimental expenditures under H.R. 1 issued
The revenue procedure advises taxpayers how to make various elections, file amended returns, and change accounting methods as provided under Section 70302 of the new law.
Tax provisions of Senate Finance’s version of the budget bill
The 549-page text calls for making many provisions of the Tax Cuts and Jobs Act permanent. The committee says that the SALT cap amount is “the subject of continuing negotiations.”
Adequate disclosure on gift tax returns: A requirement for more than gifts
Specific requirements apply to the adequate disclosure of transactions on a gift tax return.
ING trusts: How they work and their continued viability
Properly established and maintained, an incomplete gift nongrantor trust may play a valuable role in some clients’ estate plans
IRS reduces user fee for estate tax closing letters
The receipt of an estate tax closing letter generally indicates that the estate tax return’s IRS examination is closed. Final and proposed regulations lowered the fee by $11.
Limiting the unlimited charitable deduction for trusts
Although Sec. 642(c) provides for an “unlimited” charitable income tax deduction attractive to philanthropic grantors, Sec. 681 may limit a trust’s actual deduction.
Estate tax considerations for non-US persons owning US real estate
Planning options include holding the U.S. real estate through legal entities or trust structures.
Early terminations of QTIP trusts: The cautionary case of McDougall
Qualified terminable interest property trusts can be useful, but care must be taken to avoid running afoul of their requirements, as a recent Tax Court case illustrates.
The final countdown: Benefiting from the higher BEA before it potentially expires
With the basic exemption amount for estate, gift, and generation-skipping transfer taxes set to be cut in half after the end of 2025, tax advisers can lead clients in planning and taking action now.
Final regs address taxes on gifts to taxpayers from ex-U.S. citizens, residents
The final regulations implement Sec. 2801, added to the Code in 2008, and follow up on proposed regulations issued 10 years ago.
Proposed regulations update QDOT regulations
Changes to the qualified domestic trust regulations under Sec. 2056A would include defining when the value of assets passing to the trust is “finally determined.”
Life insurance proceeds not includible in estate
Proceeds from life insurance on decedent not includible in his estate.
Connelly clarifies estate treatment of stock redemption
The Supreme Court held that a corporation’s stock redemption obligation was not a liability that reduced the corporation’s value for estate tax purposes.
Final regs. issued on consistent-basis and basis-reporting rules
The IRS issued guidance for recipients of property from decedents on the basis-consistency requirement and for executors and others on basis-reporting requirements.
Fact sheet addresses taxability of crowdfunding distributions
The IRS said that crowdfunding distributions may be included in the gross income of the person receiving them, depending on the facts and circumstances of the distributions.
TAX PRACTICE MANAGEMENT
2025 tax software survey
AICPA members in tax practice assess how their return preparation software performed during tax season and offer insights into their procedures.
