The Tax Court ruled that the check-the-box (CTB) regulations do not apply for purposes of valuing the transfer of property held through a single-member limited liability company (LLC) for federal gift tax purposes.
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TOPICS
Taxation of Estates & Trusts
IRS Continues to Challenge Family Limited Partnerships
As the IRS continues to litigate family limited partnership (FLP) cases, it has formulated two broad-based arguments that the courts now routinely recognize to negate the estate planning benefits of FLPs.
Using GRATs in Tax Planning During Troubled Economic Times
Under the right circumstances, the potential benefit of a GRAT can be enormous, especially in those situations where the value of a business is expected to skyrocket once economic conditions improve.
Last-Minute Estate Planning for 2009: Focus on the GST
This article focuses on estate planning opportunities relating to the generation-skipping transfer tax that practitioners and taxpayers should consider for implementation in 2009.
Check-the-Box Regs. Do Not Affect the Valuation of LLC Interests
The Tax Court held that limited liability company (LLC) interests transferred by a taxpayer into trusts set up for the benefit of her children should be valued as transfers of LLC interests and not as transfers of the underlying assets owned by the LLC.
Trusts Owning Partnership Interests
When a trust instrument is silent and no discretionary power of administration exists, trustees and their advisers need to be knowledgeable of how partnership activity (including both taxable income and distributions received) is affected by the trust administration statutes of the state of situs of the trust.
Creative Ways of Achieving Grantor Trust Status
Trusts that may not appear to qualify as S corporation shareholders could actually be grantor trusts eligible to own S corporation stock.
Prop. Regs. on Graduated Retained Interests Under Sec. 2036
The IRS issued proposed regulations providing guidance on the portion of trust property includible in the grantor’s gross estate if the grantor has retained certain interests in the property
Estate Planning While We Sit, Watch, and Wait
Despite the impending confusion, there are some steps tax practitioners can take in working with clients to ensure their estates are in the best position over the next few years.
Guidance on Unbundling Trust Fees
The IRS announced that for tax years beginning before January 1, 2008, nongrantor trusts and estates would not be required to unbundle their fiduciary fees to determine what portion is subject to the Sec. 67(a) 2% threshold for itemized deductions.
Be Careful Making Disclaimers Where Trusts Are Involved
Disclaimers are very useful tools for estate planners, especially in postmortem planning. However, if an estate planner is not diligent in the planning and execution of a disclaimer, it can have adverse transfer tax consequences.
IRS Identifies Sale of Charitable Remainder Trust Interests as a Transaction of Interest
In a notice, the IRS has identified as transactions of interest certain transactions in which a sale or other disposition of all interests in a charitable remainder trust (CRT), after the contribution of appreciated assets to and their reinvestment by the trust, results in the grantor (or other noncharitable recipient) receiving the value of his or her trust interest while claiming to recognize little or no taxable gain.
Widow of 9/11 Victim Is Not a Terrorist Victim
A federal court ruled, in a case of first impression, that a widow who committed suicide after her husband was killed in the 2001 World Trade Center attack does not qualify as a victim of terrorism and therefore her estate does not qualify for the reduced estate tax rates under Sec. 2201(c).
The Case for an Intentionally Defective Grantor Trust
An IDGT is an effective estate-freezing tool that provides the opportunity to maintain the maximum control over the beneficial enjoyment of the transferred assets.
Funeral Trust Dollar Limitation Repealed
The Hubbard Act, P.L. 110-317, repealed the dollar limitation on funeral trusts.
Riding the Estate Planning Roller Coaster for the Next Three Years
As 2010 approaches, tax legislators and policy makers are sharply divided on a more permanent approach to taxing the transfer of wealth from one generation to the next.
Using Debt to Leverage a Taxable Gift to a QPRT
A qualified personal residence trust is a trust created to own a personal residence of the grantor for the benefit of the grantor’s spouse, children, or charity. The grantor makes a gift of a personal residence into the trust while retaining a right to occupy the residence for a term of years.
Guidance Issued on Dividing CRTs, Assisting Divorcing Couples
The IRS recently issued Rev. Rul. 2008-41, confirming that charitable remainder trusts (CRTs) can be divided into separate but equal trusts for each recipient without adverse tax consequences.
Significant Recent Developments in Estate Planning
This article examines developments in estate, gift, and generation-skipping transfer tax planning and compliance between June 2007 and May 2008.
IRS Issues Proposed Ruling on Private Trust Companies
The IRS is seeking comments from the public on a proposed ruling regarding the use of family-owned private trust companies (PTCs) as trustees of trusts. Fact Patterns in the Proposed Ruling The proposed ruling presents two situations. Situation 1 involves a PTC formed under laws of a state that has
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.
