Skepticism protects against dangers of abusive trusts

Article Abstract:

Tax consultants should be wary of trust arrangements that are designed to avoid taxation and evade creditors while allowing the taxpayer to maintain complete control of the assets. Trusts can be used to achieve estate tax savings, protect assets from beneficiaries' creditors, and retain assets for future generations, but they can be misunderstood and misused. Abusive trust arrangements are marketed to taxpayers with the guarantee of tax benefits and protection from creditors without affecting their control or enjoyment of the income or assets. Abuses monitored by the IRS are trusts that own a business and avoid self-employment tax on its income, equipment trusts that transfers its income to other trusts, trusts that hold a family residence and deduct depreciation and upkeep as administrative costs, charitable trusts established mainly for the family of the owners, and foreign trusts that allocate income to the US owner without being taxed.

Tax consultants

---

No swing vote premium on minority interest in family business

Article Abstract:

The author discusses a Tax Court ruling affirming its acceptance of a valuation discount on transfer of minority interests, thereby providing precedent for opposing IRS attempts to impose a valuation premium on a minority on the basis of the shareholder's ability to combine with another to form a majority.

Interpretation and construction, Taxation, Securities law, Minority stockholders

---

Defective trusts can effectively leverage family wealth

Article Abstract:

The author discusses defective trusts and how their use, with family limited partnerships and dynasty trusts, can help lower transfer tax costs.

Transfer taxes, Limited partnership, Limited partnerships

Similar abstracts:

• Abstracts: Criminal prosecution and the Migratory Bird Treaty Act: an analysis of the Constitution and criminal intent in an environmental context
• Abstracts: Consumers in the Wringer. Do environmental regulations increase economic efficiency? The "Backdoor Btu Tax"
• Abstracts: A microeconomic analysis of Fannie Mae and Freddie Mac. The location of industry: do states' policies matter? Does the Forest Service have a future?
• Abstracts: The NLRB's (slowly) developing Beck jurisprudence: defending a right in a politicized agency. Interim rules: making haste slowly
• Abstracts: Putting the plaintiff and defendant on even ground: defining standards of settlement review and the statute of limitations in shareholder actions

This website is not affiliated with document authors or copyright owners. This page is provided for informational purposes only. Unintentional errors are possible.