Recent Developments – Tax

House Passes Bill on 10-Year GRAT Terms; Craziest Probate Case of the Year?

As other T&E bloggers have capably noted (e.g., Gary Beyer here and Hani Sarji here), the House passed H.R. 4849 (the Small Business and Infrastructure Jobs Tax Act of 2010) on March 24. The vote was 246-178 in favor of the bill (see the full report on the vote from the New York Times here). KYEstates alerted [...]

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KYEstates Announces The “Glom On” Prizewinner; Kentucky Enacts UPMIFA

KYEstates issued a high-stakes challenge here in our discussion of the taxpayer FLP win in Estate of Petter v. Comm’r, T.C. Memo. 2009-280, 2009 WL 4598137 (U.S. Tax Ct. 2009).  We said: Count not your day a loss: you have now read the phrase glommed onto in a Federal court’s opinion.  Find that phrase in another [...]

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In re Chilton – Bad News for Creditor Protection for Inherited IRAs

As previously discussed in this post, KYEstates strives to provide fair and balanced coverage, so when we are biased, we will let you know.  To that end, we previously warned readers that we are biased in favor of the taxpayer.  (Apparently, when we made this (not-so-shocking) disclosure, the IRS noticed, because shortly afterwards we started [...]

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Timmberrr…Another Taxpayer FLP Win!

At KYEstates, we don’t want to hex ourselves, or taxpayers, but the fact is that we’re on a little bit of an FLP roll here and here. The good news for taxpayers continues with Estate of Shurtz, T.C. Memo. 2010-21 (Feb. 3, 2010). Even though the taxpayer showed up at the Tax Court with mixed [...]

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A Big News Day: Section 7520 Rate Stays Put, 10 Year GRAT Legislation, Gov. Beshear Signs HB 188!

KYEstates readers – this was a big day in the world of T&E.  Perhaps not epochal, but at least big. 1) Good news for procrastinators: although interest rates may be headed up, for April, AFRs are virtually unchanged from March levels, and the section 7520 rate has not budged.  For details, see Rev. Rul. 2010-11 [...]

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Who Will Read The 706 You File?

In any litigation matter, key questions include: “What’s discoverable?  What’s privileged?  What will the bad guys be able to find out?”  These same questions present in probate litigation and estate planning for potentially contested administrations.  If a client and the client’s advisors are planning for a contested administration, one option is to shift assets from [...]

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Heirloom Stock + Predator Creditors = Family Limited Partnership Win for Taxpayer

KYEstates is pleased to share welcome news of a taxpayer win in Estate of Black v. Comm’r, 133 T.C. No. 15 (Dec. 14, 2009). Black involved (you guessed it) a family limited partnership, and prominently features all four Big Themes of estate planning: favored and disfavored Family members, really large amounts of Money, and correspondingly [...]

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Final Section 2053 Regulations (T.D. 9468): Save Ferris!

KYEstate$ readers are well aware that administration expenses and claims against the estate are deductible from the decedent’s taxable estate under section 2053.  This is economically significant, of course, because when an estate is taxable, the government effectively picks up 45% of the attorneys’ fees or claim. (Ah, yes, the faraway days of December 2009 [...]

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Letter Ruling Provides Guidance on Inherited IRAs

KYEstates brings you PLR 200945011 (Nov. 6, 2009), a Letter Ruling that KYEstates can’t quite bring itself to really love, even though Natalie Choate surely does.  The Letter Ruling has both good news and bad news for taxpayers.  First, the good news: under the facts of the Letter Ruling, lump-sum, immediate income in respect of [...]

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Good News (As Far As It Goes) For Self-Settled Asset Protection Trusts

PLR 200944002 (Oct. 30, 2009) is an interesting development at the intersection of estate planning and asset protection planning.  The widely accepted back story to the Letter Ruling is that it relates to Alaska asset protection trusts, a topic dear to the hearts of renowned T&E leader Jonathan Blattmachr and his brother Doug, who just [...]

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