Category: Estates & Trusts
Bross Trucking Inc. v. Commissioner of Internal Revenue
T.C. MEMO 2014-107 (2014). Bross Trucking is a fascinating case from an estate planning perspective because it presents facts that occur frequently in the representation of family businesses and the planning issues confronting the entrepreneur. In estate planning for families, advisors often encounter circumstances where the family business is growing, either…
Booth vs. Division of Taxation – Important Decision Effect New Jersey Planning
BACKGROUND Booth vs. Director, Division of Taxation,27 N.J. Tax 600, decided February 11, 2014 is a far reaching and significant opinion that will change the way tax planners view the “New” New Jersey Estate Tax. The New Jersey Estate Tax, enacted in June 2002 for individuals passing away after January…
The New Jersey UTC – The Time Has Come
What is the Uniform Trust Code (UTC) and why should it be adopted in New Jersey? The Uniform Trust Code is, as the name denotes, an attempt to codify rules related to trust administration and planning. It was originally proposed by the National Conference of Commissioners on Uniform State Laws (also called…
The Ship May Not Have Sailed: It May Not be Too Late to Make a Portability Election
Recently, the Internal Revenue Service provided estate representatives and their advisors additional time to revisit and reconsider making a “portability” election for Decedents passing away in 2011, 2012 and 2013 opening up additional post-mortem planning opportunities. The concept of “portability” was introduced in December of 2010 under the Tax Relief, Unemployment Insurance Reauthorization,…
Tax Court Determines that a Trust Can Materially Participate
On March 27, the Tax Court issued a decision in Frank Aragona Trust, et al. v Commissioner, 142 TC 9 (2014). The case is very significant in that it held that a trust, through the activities of its trustees, could materially participate in an activity for purposes of the passive loss…
Estate Planning in a Decoupled State Post-ATRA for Married Clients Under the Federal Exclusion Amount
One of the more difficult challenges practitioners face is advising clients who are domiciled in decoupled states as to how to minimize state estate taxes and maximize the increases in available income tax basis to reduce the impact of the now higher capital gains taxes, all while addressing clients’ personal…
Permanent Estate Tax Relief
One of the major elements to ATRA 2012 is the fact that it has finally given the estate and gift tax a permanent law upon which taxpayers can rely. By way of background, the estate tax has been in a state of constant uncertainty since the 2001 tax law that sought to “repeal” the…
December 2010 Tax Law Makes Estate Tax Changes
On December 17, 2010 President Obama signed into law the “Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010.” The new law: Extends for two years the current income tax rates and other income tax rates commonly called the “Bush Tax Cuts.” Provides tax incentives to businesses Cuts…
Estate Planning in 2010
As 2009 drew to a close, most trust and estate practitioners believed that Congress would freeze the estate tax threshold at the 2009 exemption and rate structure of $3.5 million for estate planning in 2010. This “fix” never happened! As a consequence, for individuals who pass away in 2010 there…
President Homebuyer Credit Extension
The Homebuyer Assistance and Improvement Act of 2010 (H.R. 5623) was signed on July 2, 2010, by President Obama. The bill permits first-time homebuyers to qualify for the $8,000 credit. It also allows who have lived for five years in their current residence to purchase a new home and receive a…