Trust with beneficiary's power of withdrawal adaptable for use in many family situations
Article Abstract:
The reluctant donor is well known to many estate planning practitioners; that is, individuals who wish to make gifts to their children to save taxes but who do not want the children to receive the gifts until they reach a specified age. The usual methods for using annual exclusion do not provide sufficient control, but Section 2503(c) allows gifts to minors to be treated as a transfer of present interest if the principle or interest can be spent by or for the benefit of the minors before they reach the age of maturity. The Crummey case, which provided donors with a greater level of control when making annual exclusion gifts, is described, and the ramifications of the case for estate planners are discussed.
Publication Name: Taxation for Accountants
Subject: Business
ISSN: 0040-0165
Year: 1986
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Checks to noncharitable donees outstanding at death not includable in estate
Article Abstract:
McCarthy, 85-2 USTC, paragraph 13,648 P-H xxx,xxx (DC Illinois, 1985) found that checks written as gifts but not debited from the donor's account until after the donor's death are considered complete and cannot be included in an estate. This result was similar to Estate of Belcher, 83 TC 227 (1984) but contrary to Cullis 85-2 USTC, paragraph 13,645, 1986 P-H xxx,xxx (DC Ohio, 1985). The ramifications of each case to estate planning and taxation are discussed, with it found that when checks are given as gifts to charitable or non-charitable donees and when they have not cleared at the time of the donor's death, substantial authority exists to allow them to be excluded from the estate of the donor.
Publication Name: Taxation for Accountants
Subject: Business
ISSN: 0040-0165
Year: 1986
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Disclaimers can provide tax savings for both well and ill-planned estates
Article Abstract:
Section 2518 of the Internal Revenue Code allows a qualified disclaimer to serve as an irrevocable and unqualified refusal to accept an interest in property, real, personal, intangible or otherwise, which means the property involved is treated as if it had never passed to the person making the disclaimer for tax purposes (it is treated as if it passed from the decedent to an alternative beneficiary). Such disclaimers under Section 2518 are analyzed with examples provided, and corrective post-mortem planning, the requirements that must be met for a disclaimer to be considered qualified, and special considerations are discussed.
Publication Name: Taxation for Accountants
Subject: Business
ISSN: 0040-0165
Year: 1986
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