“Grantor trust sale transactions, like installment sales, self-canceling installment notes (“SCINS”) and private annuities, have been consistently used as legacy management and business succession planning tools. In recent internal guidance and estate tax audits, however, the IRS has rejected some generally accepted approaches to conducting these transactions….”
To read the full report, click here.
This case provides a reminder that courts will look through corporate and legal structures to hold individuals personally liable for egregious breaches of fiduciary duty. Be very conscious of ERISA’s (1) fiduciary duty of undivided loyalty, (2) the “prudent man” standard, (3) prohibition against self-dealing, and (4) prohibition against transactions “likely to injure a plan” including transactions benefitting a “party in interest.”
To read the full report, click here.
“The increased gift and generation-skipping transfer tax exemptions provide greater opportunities to benefit future generations during life. Clients with a more modest net worth, however, need transfer planning options that balance a desire to make lifetime gifts with the need to retain adequate funds to support their needs. A spousal lifetime access trust (a so-called “SLAT”) may provide one such option.”
To read the full report, click here.
“Once again, the courts have put practitioners on notice. A plan that reflects tax consequences or a tax strategy described in the IRS’s published guidance will be considered a tax avoidance transaction. Likewise, if the taxpayer knows or has reason to know that the taxpayer’s tax benefits are derived directly or indirectly from tax consequences or a tax strategy described in published guidance, it will fall within the same purview.”
To read the full report, click here.
“The Administration’s proposed tax rate increases would significantly alter the investment and planning behavior of HNWIs, potentially increasing the need for planning to mitigate and manage income tax liabilities….These proposals only reflect a Presidential “wish list” for future tax legislation and cannot take effect without Congressional approval, which may be difficult to achieve with a Republican-controlled Congress.”
To read the full report, click here.
“On January 15, 2014, The Standing Committee on Unlicensed Practice of Law of the Florida Bar Association submitted a request for formal advisory opinion from the Florida Supreme Court on whether it constitutes the unlicensed practice of law for a non-lawyer to engage in the following Medicaid planning activities leading up to the Medicaid application:”
To read the full report, click here.
“Advisors to qualified retirement plan sponsors and fiduciaries can assist their clients in looking at life insurance as an additional investment option. Careful advice and planning is necessary because of the special requirements applicable to life insurance under qualified plans.”
To read the full report, click here.
VERY IMPORTANT:?
Issues in Personal Life Insurance Planning
Life insurance planning has become more complicated as the products become more complex, the tax laws remain uncertain, and the marketplace grows more advanced. This complexity requires a much higher level of sophistication in planning and can lead to hazards and unexpected tax consequences for the inexperienced.
The proper purchase, transfer, funding, and on-going management of a life insurance policy requires the collaboration of an expert team of advisors (producers, lawyers, financial planners, accountants, etc.) and a clear process for implementation and post-closing administration.