Tax Alert…What Will the Future Hold?

As you have probably read and heard, new tax legislation is looming to “simplify” the tax law. The major estate, gift and generation skipping transfer tax (“GSTT”) changes are as follows: The House: 1. The estate and generation skipping transfer tax (“GSTT”) would be REPEALED for tax years beginning after…

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Judicial Reformation Saves Estate Taxes

In planning to save estate taxes, many married couples may provide in their documents that the applicable exclusion amount (currently 5.490 million) is to be paid to a “credit shelter trust” and the balance to a marital trust. In such an estate plan, no estate tax is generally incurred until…

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Relief for Late Filed Portabilty Elections!

The Internal Revenue Service (“IRS”) has offered needed relief for portability elections. Portability, discussed in  a prior blog, can save a surviving spouse’s beneficiaries over $2 million (in 2017) in estate taxes!  However, to utilize such savings, the surviving spouse must make a portability election on a properly filed Form…

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File Portability Election Late? Is There Relief?

The concept of portability has been discussed in a prior blog. What happens if a surviving spouse does not file the portability election timely? The spouse is potentially losing a savings of over $2 million in estate taxes! Relief for filing a late portability election depends on whether a federal…

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Portability and Blended Families…May Not Be A Good Mix!

Portability has been discussed in a prior blog but as the federal statute is fairly new, case law has been scarce. A recent Oklahoma Supreme Court (the “Court”) case has lawyers rethinking prenuptial and postnuptial agreements and the drafting of estate planning documents. As a reminder, the following is an…

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Improper GSTT Exemption Allocation…IRS Grants Relief!

The generation skipping transfer tax (“GSTT”) is a harsh tax (40%) imposed on certain transfers to grandchildren and certain individuals in that same generation. Fortunately, the Internal Revenue Code (the “Code”) provides a GSTT basic exclusion amount (the “Exemption”) which is the same amount as the basic exclusion amount for…

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State Court Rescues GRAT From Drafting Error

The estate and gift tax provisions under the Internal Revenue Code (the “Code”) are extremely complicated. Thus, you must have an experienced estate planner draft documents which use techniques that can save estate and gift taxes. Nevertheless, mistakes can happen and sometimes a court reformation can save the technique as…

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Have Foreign Bank Accounts? Be VERY Careful!

In preparing your Form 1040 you may notice a question that asks about foreign bank accounts on Schedule B.  “At any time during 2016, did you have a financial interest in or signature authority over a financial account (such as a bank account, securities account, or brokerage account) located in…

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