Take-Away: As we counsel clients about estate planning over the next few years, we do so with the expectation that interest rates will continue to rise. Some conventional estate planning strategies like qualified personal residence trusts (QPRTs), grantor retained income trusts (GRITs) and charitable remainder annuity trusts (CRATs) perform well as interest rates continue to […]

Take-Away: While a trust should always contain a material purpose clause to guide the trustee, and possibly guide a probate judge as well, as to the settlor’s intent in establishing a trust, if the trust instrument confers discretion on the trustee with regard to distributions, the settlor should also supplement the trust instrument with non-binding […]

Take-Away: Yet another state court has found unconstitutional its state income taxing regime that imposes a state income tax on income accumulated in an irrevocable trust, the claimed authority to impose the tax based solely upon the residence of the trust settlor. Fielding v Commissioner of Revenue (MN July 18, 2018.) Summary: On July 18 […]

Take-Away: While we are less concerned about federal estate tax liability these days, a working knowledge of the Tax Code’s ‘string provisions’ is critically important when individuals decide to make aggressive use of today’s large tax-free gifting opportunities presented by the 2017 tax law. That said, the IRS seems to be making headway in re-asserting […]

Take-Away: Confusion was created by the 2017 Tax Act when it comes to the deductibility of trustee’s fees. The Treasury Department just released a Notice that promises some guidance on the continued income tax deductibility of trustee fees under the 2017 Tax Act. Background: The 2017 Tax Act eliminated itemized income tax deductions (sometimes referred […]

Take-away: Thirty years ago, from the unlikely source of Wyoming,  the civil law concept of the limited liability company arrived in North America.  We now find yet another civil law concept that has made its way onto the shores of North America, the Non-Charitable Private Foundation, from yet another unlikely source- New Hampshire. The LLC […]

Take-Away: When a trust is created with specific tax objectives in mind, it is critical that the trust instrument be administered according to its express terms, especially when tax objectives motivated the trust’s creation. Unlike a game of horseshoes, getting ‘close’ is not enough when it comes to administering a trust with tax objectives. Background: […]

Take-Away: Michigan, along with most other states, has adopted the Uniform Probate Code. One of the controversial provisions of that Code is the ability to treat and admit as a Will or Codicil a document or writing that has NOT been executed in compliance with Will execution formalities Michigan Rule: The scope of this rule […]

Take-Away: The 2017 Tax Act overhauled the tax treatment of spousal support that is paid incident to a divorce or legal separation. Along with those changes in the taxation of a spousal support award is the repeal of the alimony trust which was equivalent to a legal exception to the grantor trust taxation rules. The […]

Take-Away: You have repeatedly heard from me that the best way to transfer an IRA is to move the funds from the ‘old’ IRA custodian directly to the ‘new’ IRA custodian, and skip the 60 day rollover. Every year the IRS reports on IRA owners who for some reason end up blowing the 60 days […]