Monthly Archives: June 2010

Asset Sales to Grantor Trusts: Antidote to New Estate Tax?

PDF:   Sales of Assets to Defective Grantor Trusts I.     Introduction   Asset sales to grantor trusts exploit income tax provisions enacted to prevent income shifting by capitalizing on different definitions of “transfer” for transfer and income tax purposes. The objective … Continue reading

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Marital Deduction Planning

PDF: Marital Deduction Planning.wpd I.    Review of Current Wills   The estate tax will resume no later than January 1, 2011. At that time, the exemption amount may be $1 million (if Congress fails to do anything), or it could … Continue reading

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Gift Planning in 2010

PDF:  Tax News & Comment — March 2010 I.    Introduction   Many taxpayers wish to transfer assets to their children during their lifetimes rather than at their death. Therefore, lifetime transfer planning remains important for reasons wholly independent from the … Continue reading

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House Passes $56 Billion “Tax Extenders” Bill

The House, on May 29, by a vote of 215-204, approved a $56 billion tax bill, the “American Jobs and Closing Tax Loopholes Act”. The Senate has already approved a similar measure. President Obama is expected to sign the bill. … Continue reading

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New Carryover Basis Rules

Prior to 2010, property acquired from a decedent generally received a stepped-up basis under IRC § 1014. The purpose of the statute is to avoid the double taxation that would result if the asset were first subject to estate tax … Continue reading

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Modifying or “Decanting” Irrevocable Trusts

Despite the best efforts of drafters to contemplate unforeseen circumstances, situations arise where dispositive trust provisions may not reflect the present circumstances of beneficiaries. If the trust is revocable, and the grantor is alive, the grantor may revoke or amend the trust. However, trusts are often made irrevocable for tax or asset protection purposes. In those cases, revoking the trust, while not impossible, may be extremely difficult, especially if minor beneficiaries are involved. Continue reading

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