Estate planning update: Summary of recent proposed regulations
This item summarizes the impact of two sets of proposed regulations issued by Treasury in early 2022.
Taxation of Estates & Trusts
Estates can now request late portability election relief for 5 years
The IRS extended to five years the period under which a taxpayer can use a simplified method (in lieu of a letter ruling request) to obtain an extension of time to make a portability election.
Regs. proposed for present value of estate deductions
Administrative expenses and claims against estates allowable under Sec. 2053 beyond a three-year grace period would be discounted for current deduction, under proposed rules issued by the IRS.
Freezing stock value with a corporate recapitalization
A corporate recapitalization can freeze the value of the owner’s stock, potentially reducing the owner’s estate tax liability by removing future appreciation in the value of stock from the owner’s estate.
Tax Court determines value of receivable from a split-dollar life insurance arrangement
The value of a receivable created by split-dollar life insurance arrangements is the receivable’s value, not the cash-surrender value of the insurance purchased under the arrangements
Trusts as S corporation shareholders
Generally, a trust cannot hold stock of an S corporation; however, grantor trusts, testamentary trusts, voting trusts, ESBTs, and QSSTs are permissible S corporation shareholders (Sec. 1361(c)(2)).
Trusts for holding S corporation interests: QSSTs vs. ESBTs
This article compares the relative advantages and disadvantages of a QSST versus an ESBT in estate planning.
IRS proposes to amend estate and gift tax basic exclusion regs.
Exceptions to the special rule allowing the temporarily higher basic exclusion amount to apply to gifts credited against estate tax.
10 common Form 709 mistakes
While it may take some finesse to report the most complicated transactions on Form 709, you do not have to be a gift tax specialist to be aware of 10 common return preparation mistakes.
Tax issues that arise when a shareholder or partner dies
This article discusses what partnerships, S corporations, and their owners need to know to manage the tax risks that arise when an individual partner or shareholder dies.
Indirect gift tax considerations for 2021
It is important to consider some of the less-obvious gifts when you are advising clients who are intent on using up their full $11.7 million basic exclusion amount before the end of the year.
Planning with charitable lead trusts
Today’s low interest rates make charitable lead trusts a more powerful option for tax-efficient estate planning.
Helping a client benefit from an intentionally defective grantor trust
These trusts can be advantageous to wealthier clients, but their future use in estate planning is threatened by current legislative proposals.
The grantor trust rules: An exploited mismatch
This article discusses the history of the grantor trust rules, how they are exploited to avoid taxes, and ways the rules might be reformed to prevent them from being used for tax avoidance.
Recent developments in estate planning: Part 2
This second part of an annual update examining developments in estate, trust, and gift taxation covers recent court cases, proposed regulations, and other IRS guidance on estate tax.
Recent developments in estate planning: Part 1
This first part of this annual update focuses on trust and gift tax issues.
Penalty for failure to report distribution from foreign trust not reduced
The penalty for failure to report a distribution from a foreign trust is not reduced when the trust beneficiary is also the trust owner.
Final regulations establish a user fee for estate tax closing letters
The letters, which the IRS provides as a courtesy to executors and other authorized estate representatives, will now cost $67.
Planning with revocable trusts after the grantor’s death
This article focuses on the key tax and reporting areas applicable to revocable trusts and the associated planning and pitfalls that arise at the grantor’s death.
Would you like SALT with that trust?
The total tax owed by a trust can be significantly affected by the location of grantors, beneficiaries, trustees, and even trust assets.
