Take-Away: With the Presidential campaign soon, to take center stage this year, individuals might consider adopting some estate planning steps or trusts before the election is final and the possible change in the White House and composition of Congress. Background: Senators Warren and Sanders recently gained our attention renewing their proposed tax law changes that […]

Take-Away: The SECURE Act created some confusion when it increased the required beginning date after which required minimum distributions will be taken to age 72, but it left in place the existing rule that permits required minimum distributions to be satisfied with qualified charitable distributions once the IRA owner attains age 70 ½.  Adding to […]

Take-Away: The SECURE Act’s ‘new’ 10-year distribution rule has left many confused as to whether it replaces the Tax Code’s at least as rapidly distribution rule when the IRA owner dies after his/her required beginning date. It appears that despite the ‘new’ 10-year distribution rule, the at least as rapidly option to take distributions over […]

Take-Away: Some commentators have suggested the transfer of title to a residence to a non-grantor trust to circumvent the 2017 Tax Act’s $10,000 deduction limitation on state and local taxes (SALT) as the trust is a separate income taxpayer with its own itemized deductions. While that planning step may be attractive,  it is important to […]

Take-Away: With the SECURE Act’s elimination of the stretch distribution rules for most retirement account beneficiaries, more attention may now be devoted to the use of charitable remainder unitrust as a substitute for an existing conduit see-through trust. A charitable remainder unitrust can work reasonably well as an alternative to a stretch see-through, but not […]

Take-Away: An irrevocable trust faces a marginal federal income tax bracket of 37% on accumulated income in excess of $12,750 each year. One way to mitigate that tax erosion is to establish a beneficiary deemed owner trust, or BDOT. With a BDOT the beneficiary is taxed on the trust’s income each year, at the beneficiary’s individual […]

Take-Away: Estate plans these days’ focus on obtaining an income tax basis ‘step-up’ on the death of the owner of appreciated assets to avoid capital gain recognition by heirs and trust beneficiaries. While an income tax basis adjustment occurs on the death of the owner, there are two notable exceptions to the income tax basis […]

Take-Away: Like many other states, Michigan adopted the Uniform Probate Code in large part, and in particular its model provision that provides for the automatic revocation of a divorced spouse’s beneficial interest under a deceased former spouse’s ‘governing instrument.’ That automatic revocation includes not only the former spouse, but any provisions that are made for […]

Take-Away: A few months ago a Bankruptcy Court decision was brought to your attention where a former spouse who received part of his wife’s IRA as a result of their divorce settlement, divided pursuant to IRC 408(d), lost that IRA in a subsequent bankruptcy proceeding, where the debtor’s post-divorce IRA was not treated as an […]

Take-Away: More and more trusts are drafted with the addition of a trust protector provision. While the use of a trust protector helps to adapt the trust instrument to future changes in circumstances and thus it adds considerable flexibility to the trust’s administration, more thought needs to be given to the powers conferred on the […]