Using trusts to shift income to children
Use of a Sec. 2503(c) or minor’s trust allows for transfers of property (and income shifting) to children, while parents maintain control of the property at least until the child reaches age 21.
Estates
Supreme Court holds North Carolina cannot tax trust
The U.S. Supreme Court issued a unanimous decision holding that North Carolina’s attempt to tax a trust based solely on the residence of a beneficiary violates the Due Process Clause of the 14th Amendment.
New limitation on excess business losses
The TCJA amended Sec. 461 to include a subsection (l), which disallows excess business losses of noncorporate taxpayers if the amount of the loss is in excess of $250,000 ($500,000 in the case of a joint return).
The impact of tax reform on DNI, and a reason to revisit trust accounting income
It is important to note the role trust accounting income plays when preparing the annual income tax return for the trust, a role that has become more prominent since the enactment of the TCJA.
Minimizing federal income tax on trusts under the TCJA
The disparate tax treatment between trusts and individuals has grown even more pronounced than it was before the TCJA was enacted.
Can a state tax a trust based on the beneficiary’s residency?
The U.S. Supreme Court heard oral arguments in a case that will decide whether states can tax trusts based solely on the fact that a trust beneficiary lives in the state.
Traps for the unwary: Tax Cuts and Jobs Act changes
This article lists the changes together, along with some unexpected nuances.
Charitable gift arrangements that provide alternatives to a private foundation
Allowable charitable contribution deductions and control over donated funds are key factors for taxpayers to weigh when considering alternatives to private foundations.
Missed opportunities in estate planning: Beyond wills and trusts
An estate plan is incomplete without a detailed list of instructions that explains how to carry it out.
IRS proposes rules on estate and gift tax clawback
The IRS addressed issues and made conforming revisions arising from the temporary increase in basic exclusion amount for estate and gift tax enacted by legislation known as the Tax Cuts and Jobs Act.
Qualified opportunity zones provide estate planning options
Investors with significant capital gains should investigate opportunities to reinvest their cash within designated QOZs to take full advantage of this tax boon.
Clarification of itemized deductions for trusts and estates
Regulations are anticipated to clarify that the costs of trust or estate administration that are deductible under Sec. 67(e)(1) are not miscellaneous itemized deductions and, therefore, their deductibility has not been suspended by Sec. 67(g).
Claiming the QBI deduction for trusts
The enactment of Sec. 199A provides one more reason to advise clients to create separate trusts for individual beneficiaries instead of a single trust.
Estate and gift exclusion clawback addressed in proposed regs.
The IRS addressed issues and made conforming revisions arising from the temporary increase in basic exclusion amount for estate and gift tax enacted by legislation known as the Tax Cuts and Jobs Act.
Recent developments in estate planning: Part 2
This article is the second of two parts of an annual update on developments in trust, estate, and gift taxation. It covers generation-skipping transfer tax and trust tax developments, as well as inflation adjustments for 2018.
Recent developments in estate planning: Part 1
This first of a two-part article discusses legislative, gift, and estate tax developments.
Income taxation of trusts in California
The California Superior Court determined that all income, including California-source income, is subject to the apportionment formula.
IRS gets decedent’s share of proceeds from asset sale
The IRS was entitled to an estate’s share of the proceeds from the sale of limited partnerships’ assets after it intervened in a suit between the estate and the partnerships.
Income taxation of trusts and estates after tax reform
This item offers an overview of the main amendments to the income taxation of trusts and estates included in the TCJA.
Revenue procedure contains tax rate tables and inflation adjustments under new tax law
The IRS announced new lower tax brackets for 2018 and a number of other new items affected by the Tax Cuts and Jobs Act.
