Having made changes to the proposed regulations, the IRS issued final rules affecting the generation-skipping transfer tax

Article Abstract:

The Internal Revenue Service released at the end of 1995 its final rules on generation-skipping transfer tax, in some ways stiffer and in others more favorable than the proposed regulations. Significant changes affect taxable terminations, the predeceased child rule, provisions of the estate tax inclusion period, the definition of a skip person, the taxable distribution look-through rule, the use of non-general powers of appointment, division of a trust into separate trusts, and the tax's impact on non-resident aliens.

Tax Law, Public Finance Activities, Finance, taxation, & monetary policy, Internal Revenue Service, Generation-skipping transfer tax

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Proposed tax legislation in the House may affect U.S. citizens who become expatriates as well as foreign trust beneficiaries

Article Abstract:

A bill introduced in the House of Representatives seeks to change how expatriated US citizens and departing long-term resident aliens pay their taxes. It would render foreign trusts less valuable and often actively harmful to US grantors and beneficiaries, and is likely to have unfair and unnecessary repercussions. However, HR 981 or something very like it will probably pass, with retroactive effect to Feb 5, 1995, making avoiding its impact both difficult and dangerous.

Political aspects, Expatriation, Taxation of aliens

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The Internal Revenue Service has revoked a 15-year-old ruling that limited the right of a trust's creator to remove and replace a trustee

Article Abstract:

The Internal Revenue Service recently issued Revenue Ruling 95-58, which revokes the unpopular Revenue Ruling 79-353 and modifies Revenue Ruling 77-182. Ruling 79-353 made property in an irrevocable lifetime trust includable in the grantor's taxable estate if the grantor reserved the power to remove the corporate trustee and appoint a new one. Ruling 95-58 drops this inclusion when the grantor appoints as a new trustee someone not subject to the grantor's control.

Estate tax, Estate taxes, Powers (Law)

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