Missives

The initial trustee of a Trump account has been identified by Treasury, along with rules for when funds are rolled over to a successor trustee of a Trump account. The IRS has also released a draft of the Form for annual reporting for Trump accounts.

Ladybird deeds are highly effective to avoid probate of real estate on the owner’s death, but they can also expose the beneficiary to losses due to the lapse of insurance coverage.

When reporting income, beware of the claim of right doctrine that requires reporting the income in the year of its receipt when there are no apparent restrictions as to the income’s disposition, even if that income must later be repaid.

Not all wedding expenditures result in taxable gifts, but it will be important to structure and document large expenses correctly to allocate them to hosting costs and thus avoid being classified as an indirect gift.

A charitable lead annuity trust, or CLAT, is a powerful estate planning tool to exploit a charitable deduction and potentially pass future appreciation to heirs without any transfer tax cost.

A probate court can impose a constructive trust to restrain the use or transfer of assets as an equitable remedy to prevent unjust enrichment if the court believes that property is wrongfully obtained or held.

The intended purpose behind all of these uniform laws is to provide consistency and efficiency in the disposition of wealth in a highly mobile society.

A spouse’s consent is not normally required when a plan participant takes a distribution or borrows from his/her qualified plan account, such as a 401(k) plan account.

Whenever the topic of a domestic asset protection trust (DAPT) comes up, there is always the cautionary remark that other states which do not have DAPT legislation may not respect a DAPT that is established in another state that does recognize such a trust.

Promoted tax planning ‘strategies’ often fall into the ‘too good to be true’ category. With the IRS on the lookout for the use of Charitable LLCs, it would be wise to stay clear of them.