Take-Away: A family that is considering the acquisition of real property might consider the use of a Split Purchase Annuity Trust [SPLAT] to take title, as an alternative to a qualified personal residence trust (QPRT) or a grantor retained annuity trust (GRAT.) Background: A donor is treated for gift tax purposes as transferring the entire […]

Take-Away: If one thing is certain, it is that with every new Congress, some representative will file a Bill to repeal the federal estate tax. Other than the one-time event in 2010 which provided a federal estate tax ‘holiday,’ each Bill to repeal the federal estate tax will disappear, only to be refiled in the […]

Take-Away: Despite all of the angst caused earlier this year when Senator Elizabeth Warren proposed a wealth tax, it does not look like such a tax will be gaining any traction in the near future. Background: Senator Warren proposed during her Presidential campaign a wealth tax of 2% on annual wealth tax on wealth in […]

Take-Away: Late last month the IRS answered a question many had with regard to the amount of charitable deductions an individual can claim in 2020 if that individual makes gifts of both appreciated assets and cash in light of the CARES Act’s increase in the amount of cash that can be deducted for 2020. The […]

Take-Away: The benefit to lifetime gifts to a non-grantor irrevocable trust have been periodically covered in the past. Why they are covered again is the threat that grantor trusts might be subject to substantial tax law changes as Congress struggles to find revenues to pay for its pandemic relief programs, and to many, a grantor […]

Take-Away: With 2021 comes some new federal transfer tax exemptions. In the case of annual exclusion gifts there is no change from 2020.  A couple of changes also apply to the income taxation of trusts and estates. Transfer Tax Exemptions: The key transfer tax exemption changes for 2021 follow. Basic Exclusion Amount: For decedents who […]

Take-Away: Much has been written about ‘upstream’ planning, where appreciated assets are gifted to an elderly parent with the purpose of receiving a step-up in the income tax basis of the gifted assets on the death of the parent. Much less has been written about the benefit to ‘downstream’ planning, where assets are transferred to […]

Take-Away: In 2020, there were more than 71,000 ABLE accounts that held more than $470 million assets. The average ABLE account held $6,600 in assets.  It took the Treasury Department six years to publish Final Regulations with regard to ABLE accounts. The Final Regulations were published on October 1, 2020; fortunately, there were few surprises […]

Take-Away: This month the IRS issued a Release that encourages individuals to take necessary actions in the final weeks of 2020 to help timely file their income tax returns early in 2021. Background: In its Release [IR 2020-272, December 8, 2020] the IRS pointed out a couple of reminders to assist individuals with filing their […]

Take-Away: On the first anniversary of the SECURE Act, the changes that it brought to retirement account distributions has resulting in some changes to how advice is given to individuals with large retirement account balances. Background: The SECURE Act eliminated stretch IRA distributions for most nonspousal beneficiaries, replacing lifetime IRA distributions from an inherited IRA […]