Deductions
The methods for calculating a charitable remainder annnuity trust and a charitable remainder unitrust are different because the CRUT income stream fluctuates with changes in the value of the trust property. The technicalities involved in determining the value of the income stream or the remainder interest are much more complex for a CRUT.
The IRS issued final and proposed regulations giving guidance on the application and computation of the 3.8% net investment income tax imposed by Sec. 1411.
The IRS issued final and proposed regulations giving guidance on the application and computation of the 3.8% net investment income tax imposed by Sec. 1411.
In August, the IRS released a draft dual-purpose form that will be used by individuals and trusts and estates to compute and report the new 3.8% net investment income tax.
The IRS released a draft of Form 8960, a new dual-purpose form that will be used by individuals and trusts and estates to compute the new 3.8% net investment income tax.
The AICPA submitted comments to the IRS recommending many changes to the proposed regulations on the new net investment income tax.
This article discusses how the new 3.8% net investment tax applies to trusts and estates.
The IRS released proposed regulations governing the 3.8% net investment income tax imposed under Sec. 1411.
The Ninth Circuit held that an estate could deduct as a claim against it only the amount of state income tax and interest with respect to the income on a transaction that the estate ultimately paid, not the amount that it estimated at the time of the decedent’s death it would have to pay on the income.
The Tax Court held that an estate could deduct as an administration expense interest incurred when a trust that was part of the estate borrowed funds to enable the estate to pay its federal estate tax.
The author reviews the gross income requirement for charitable deductions taken by trusts.
A taxpayer may deduct losses generated from passive activities only to the extent of the income from such activities. For this purpose, any trade or business or other income-producing activity is passive with respect to a taxpayer if the taxpayer does not materially participate in the activity.
A taxpayer may deduct losses generated from passive activities only to the extent of the income from such activities. For this purpose, any trade or business or other income-producing activity is passive with respect to a taxpayer if the taxpayer does not materially participate in the activity.
The Eighth Circuit held that a partial disclaimer of an interest in an estate was valid and that the estate was entitled to a charitable deduction for the portion of the disclaimed amount that was given to a charitable foundation.
The Seventh Circuit has held that the doctrine of substantial compliance would not allow a trust to take a charitable deduction where the trustee had intended, but failed, to reform the trust as a charitable remainder unitrust.
