This first installment of a two-part article on everything practitioners should know about the estate tax includes the unified estate tax rules and exemption amounts, estate valuation, portability, and what’s included in the gross estate.
Taxation of Estates & Trusts
Previously, since 2014, an extension of time to claim the deceased spousal unused amount could be obtained only by a letter ruling request.
A beneficiary’s disclaimer could adjust the results of an existing irrevocable trust.
The contracts' extension was not a sale or exchange, and open-transaction treatment continued, the Tax Court holds.
Many tax attributes vanish at the end of life, and clients are well-advised to include them in their final arrangements.
In a taxpayer-friendly development, the IRS issued guidance permitting certain estates to make a late portability election if they did not make a timely election.
Key features include a large reduction in the corporate tax rate, fewer and lower tax brackets for individuals, and a repeal of the estate tax and the alternative minimum tax.
Wealth planning with these often highly advantageous tools must be weighed against possible drawbacks of income tax accounting.
The IRS spelled out the procedures same-sex married couples should use to recalculate the transfer-tax treatment for property transferred to spouses before the U.S. Supreme Court invalidated Section 3 of the Defense of Marriage Act.,
The Tax Court finds a sufficient nexus between the Ponzi scheme theft loss suffered by an LLC and the value of the estate's interest in the LLC.
The IRS aims to close a 'loophole' of lapsing rights and restrictions in transfers of family-owned businesses.
The IRS issued its annual revenue procedure containing inflation-adjusted amounts for the 2017 tax year, affecting over 50 Code provisions, as well as the new tax rate tables for individuals and estates and trusts.
The IRS removed a prohibition on making a qualified terminable interest property (QTIP) election when the election would have been null and void because the estate had a zero estate tax liability.
The new law imposes a potentially elaborate reporting regime for values of estate property and ominous consequences for failures.
Charitable deductions stand a much better chance of being upheld when taxpayers closely follow the qualified appraiser rules.
The IRS announced one last postponement in the due date for filing under rules requiring reporting of the value of an estate’s assets to the IRS and beneficiaries.
Many charitable organizations will not accept a gift of an LLC or limited partnership units because the entity’s business is not part of their charitable mission.
The regulations reiterate the delayed reporting deadline of March 31, 2016.
Sumner Redstone’s 1972 transfer to children’s trusts, unlike his brother’s, was voluntary and nonbusiness-related.
State law theories of liability were not proved, the Tax Court holds.