Disclaiming a fiduciary power may save an estate plan
Article Abstract:
Section 2518 allows disclaimers of fiduciary powers to be a beneficial tool in estate planning. Under this section, disclaiming a power over assets covered by a testamentary or 'inter vivos' trust qualifies as an aspect of post-mortem estate planning. However, state laws on fiduciary power disclaimers vary and the IRS has assumed a strong position in upholding local laws that invalidate such disclaimers. Thus, a disclaimer can only be beneficial if it meets the requirements specified in Section 2518(b) and if the recipient has been authorized by the testamentary instrument to disclaim. Chances are better for parties seeking to disclaim their fiduciary powers but cannot qualify under state law in Cleaveland, OH, wherein a district court ruled against the IRS' position on fiduciary power disclaimers and local laws.
Publication Name: Taxation for Accountants
Subject: Business
ISSN: 0040-0165
Year: 1992
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Generation-skipping tax regulations issued
Article Abstract:
A series of generation-skipping transfer (GST) tax rules and filing requirements are included in Proposed and Temporary Regulations (TD 8187), effective for GSTs after Oct 22, 1986. A flat-rate tax will be imposed on all non-charitable transfers that avoid estate or gift tax, with the exception of gifts under $10,000, payment of educational or medical expenses, Section 2631 exemptions to $1 million, and direct transfer to grandchildren before 1990 that do not exceed an aggregate $2 million per grandchild. Irrevocable trusts initiated before Sep 25, 1985 are exempt unless additions were made subsequently, and certain transition conditions under the new rules allow exemptions.
Publication Name: Taxation for Accountants
Subject: Business
ISSN: 0040-0165
Year: 1988
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Estate's debts preclude safe harbor redemptions
Article Abstract:
A case is discussed in which short-term measures for obtaining cash to pay estate taxes and administration expenses reduced the ability of two estates to redeem stock under the beneficial provisions of Section 303 in Ltr. Rul. 8839013. The estates may also have risked acceleration of the taxes due under Section 6166. If loans can be shown to be legitimate and necessarily and actually incurred, it would seem that interest payments could qualify as administrative expenses.
Publication Name: Taxation for Accountants
Subject: Business
ISSN: 0040-0165
Year: 1988
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