Take-Away: The Tax Code’s self-dealing rules are designed to prohibit perceived abuses when financial transactions are entered into between a disqualified person and a private foundation. As a surprise to some, these same self-dealing prohibitions also apply to charitable lead trusts (CLTs) and charitable remainder trusts (CRTs.) The penalties associated with self-dealing transactions are onerous. […]

Take-Away: Reports out of Washington D.C. are that the Setting Every Community Up for Retirement Enhancement, aka the SECURE Act, may be attached to the $1.4 trillion spending bill for fiscal year 2020. December 20 is the deadline for approving that spending bill before another government shutdown is upon us. Timing: That spending bill, tied […]

Take-Away: Just to keep us on our toes, there are two different Roth IRA 5-year seasoning rules with regard to the taxation of distributions from a Roth IRA account which we need to keep straight. The difference results if the Roth IRA was created through contributions or if the Roth IRA was created via a […]

Take-Away: I was recently asked why a provision regularly appears in irrevocable trusts that ties the hands of the trustee in making distributions. I explained that the regularly recurring provision that elicited their question is called the Upjohn provision that is intended to avoid trust assets being included in an individual trustee’s taxable estate. This […]

Take-Away: We know that if an IRA owner dies after his or her required beginning date (currently age 70 ½) but before he or she takes their full required minimum distribution (RMD) in the year of their death, the beneficiary of that IRA must take the deceased IRA owner’s RMD for that year. That is […]

Take-Away: Last week we covered nonjudicial settlement agreements to change how a trust is administered. In the past, we have covered the various provisions of the Michigan Trust Code that authorize the modification, or in some cases termination, of an irrevocable trust. We have also reviewed Michigan’s two decanting statutes, where the trustee creates a […]

Take-Away: A look back at the past 10 years reinforces the conclusion that there has been anything but certainty when it comes to the federal estate, gift and GST tax laws. It is challenge for advisors to give sound and practical planning advice to individuals when the transfer tax laws change as dramatically and frequently […]

Question: Is there an affirmative duty owed by a successor trustee to correct mistakes made by the predecessor trustee in the administration of the trust estate? In the question posed, the predecessor trustee incorrectly calculated the unitrust amount (4%) that was distributed to the lifetime trust beneficiary. Answer: There is no express affirmative duty to […]

Take-Away: As we enter into the annual charitable giving season, the questions arise if a pledge to a charity is enforceable or if outstanding at the time of the pledgor’s death, if it is a deductible debt. Michigan’s law on the enforcement of charitable pledges is weak and without much guidance. The federal government has […]

Take-Away: A Bill is working its way through Lansing that would not make it a crime to cohabit with another person. (Now there is a surprise for some of you!) While Michigan does not acknowledge common-law marriages as it once did, some Michigan residents who cohabit might nonetheless have their relationship classified as a valid […]