Tag Archives: tax planning

The Big Six’s “Unified” Tax Framework: Potential Impact & Look Ahead

“The so-called “Big Six’s” proposed tax reform framework calls for significant reductions in income and corporate tax rates and a repeal of the estate and generation skipping transfer (GST) tax (but is notably silent on the gift tax).  Regardless of how the details shift as a final legislative package is crafted, life insurance remains an essential component of a comprehensive and well-balanced financial plan.”

To read the full report, click here.

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No Good Deed Goes Unpunished – Does the Executor Know He Can be Personally Liable for Unpaid Taxes?

“In the spirit of the IRS always gets theirs, a continuing trend, executors who pay general creditors or distribute property to beneficiaries before paying federal claims can be personally liable for any unpaid estate taxes.”

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Keep on Truckin’ – Leaving One State for Another? Don’t Get Stuck In Between

“As budgets are squeezed, more states are challenging state residency changes for income tax purposes.  Each state has its own unique set of rules for establishing or terminating income tax residency.  Some states base tax residency on an objective test that counts the number of days the individual is present in the state, while others impose a subjective test that looks at the individual’s state connections.”

To read the full report, click here.

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Estate Tax Apportionment – Surprise: Whose Paying My Transfer Tax Bill

“Apportioning estate taxes among various bequests is complex and requires an understanding of the individual’s wishes and assets and knowledge of the Federal reimbursement and applicable state apportionment statutes. Well thought out and carefully drafted tax apportionment provisions will facilitate carrying out the client’s intent and minimize controversy regarding the payment of taxes following the client’s death.”

To read the full report, click here.

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Rest in Peace: Adequate Disclosure on Gift Tax Returns – Seeking Closure on Clients’ Legacies

“If clients are going to spend the time and expense to plan, then they should also try to protect their efforts.  Adequate disclosure is a proactive tool for clients to ensure some finality in the valuation and potential taxation of their lifetime legacy planning.  Clients should plan to provide full and detailed disclosure, which will require extensive cooperation and coordination among all the client’s advisors (insurance, financial, accounting, legal) to avoid mistakes that could otherwise result in costly amendments of returns and additional audit and tax exposure to the client.”

To read the full report, click here.

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The Hits Just Keep on Coming: 2016 Gift, Estates & Trusts Priorities – IRS Names Grantor Trusts Among New Items

“The Priority Guidance Plan indicates that 2016 could be an eventful year for estate and life insurance planning.  The potential uncertainty of the scope, content and timing of the planned guidance emphasizes the importance of having access to not only updated technical information but also to practical analyses of these tax developments, their real world application, and how advisors and clients should respond.”

To read the full report, click here.

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Happy Holidays: A Few Simplified Charitable Giving Approaches Using Life Insurance

“Given the ease of using life insurance, charitable giving can be a popular year-end topic for clients looking to satisfy both philanthropic and tax planning goals.”

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Non-Grantor Trusts Can be Taxing – Part II: State Income Tax Considerations

“With income tax rates now exceeding transfer tax rates, trustees are becoming more proactive in understanding the state income tax exposure of non-grantor trusts.  Trustees have a fiduciary duty to consider the potential tax consequences of their trust administrative and distributions decisions, and moving the administration of the trust to a state with different tax rates or rules, changing trustees, decanting, or dividing a large trust into separate trusts can be useful tools when making these decisions.”

To read the full report, click here.

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Non-Grantor Trusts Can Be Taxing

“Higher income tax rates and compressed rate schedules applicable to non-grantor trusts, combined with the imposition of the net investment income tax on passive trust income, are key considerations in the administration of non-grantor trusts.  Evaluating the impact of distributions to beneficiaries in lower tax brackets, the acquisition of life insurance, and the re-configuration of investment portfolios are all important management tools available to trustees.

To read the full report, click here.

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