The newsletter of the ISBA’s Section on Trusts & Estates
Browse articles by year: 2014 (55)
Newsletter articles from 2005
Discharge of personal responsibility for federal tax
The executor or administrator who is "qualified and appointed and acting in the United States" may apply in writing for discharge of personal liability for the decedent's income and gift tax liabilities. IRC §6905(a) (referred to herein as "executor").
Public Act 094 0057 amends the Small Estates Affidavit provisions (755 ILCS 5/25 1) by making clear that the new $100,000 ceiling applies to estates regardless of the date of death of the decedent.
Final regulations on GST Elections-Even more taxpayer friendly
IRS has issued Final Regulations that provide guidance for making IRC Section 2632(c)(5)(A)(i) election to not have the deemed allocation of unused generation-skipping transfer (GST) tax exemption apply for certain transfers to a GST trust (IRC Section 2632(c)(1)), and the Code Section 2632(c)(5)(A)(ii) election to treat a trust as a GST trust.
From the editors
In this month's newsletter, we lead off with an article by fellow Section Council member Guy E. Williams and his colleague Scott E. Garwood on Circular 230, which includes an update for the guidance released May 18, 2005.
From the editors
In this newsletter, we lead off with Sowmya Bharathi who compares how HIPAA coordinates with various health care-related statutes in Illinois, including the Illinois Health Care Power of Attorney Act and why our standard Illinois Health Care Power of Attorney will enable an agent to be treated as the individual for purposes of HIPAA compliance.
In brief: Case reviews
In the Estate of Jelke, the Tax Court acknowledged that its position to reduce built-in capital gains was a controversial.
In support for will depository legislation for Illinois
1. The concept of a will depository [being one and the same as a “will repository”] has been a goal of the Trusts and Estate’s Committee of the Illinois State Bar Association dating back to approximately 1988 when it was first proposed by Mr. Joseph LaRocco, an older sole practitioner in Chicago, now deceased, who was then a member of the Committee.
The living will
Health care documents have been given a lot of press lately. Months after the Terri Schiavo case, people are still inquiring about living wills.
Other recent developments and cases
The Service issued Proposed Regulations under section 2702, 69 Fed. Reg. 44476 (2004), consistent with the holdings in Walton v. Commissioner, 115 T.C. 589 (2000), acq., Notice 2003-72, 2003-44 I.R.B. 964 (Nov. 3, 2003), and Schott v. Commissioner, T.C. Memo 2001-110, rev'd and remanded 319 F.3d 1203 (9th Cir. 2003).
Prompt assessment of federal tax related to a decedent
An executor or administrator of a decedent's estate can request a prompt assessment of a tax relating to returns filed by the representative of a decedent's estate, i.e., income tax of a decedent (Form 1040); estate income tax (Form 1041); and/or the decedent's gift tax (Form 709). (I.R.C. §6501(d)).
Proposed regulations to elect out of deemed allocations
The Internal Revenue Service issued Proposed Regulations under section 2632 concerning (i) guidance for making the election under section 2632(c)(5)(A)(i) to elect out of the deemed allocation of unused Generation Skipping Tax ("GST") exemption under section 2632(c)(1) to a GST trust, (ii) guidance for making the election under section 2632(c)(5)(A)(ii) to treat a trust as a GST trust, and (iii) guidance with regard to electing out of deemed allocations to a specific transfer or a specific transfer and all subsequent transfers to a trust.
Proposed Will Depository Legislation—Probate Act of Illinois
(a) A depositor, as defined in section (e), may deposit a will with the circuit court clerk of the county in which the testator resided when the testator executed the will if the depositor certifies that he is unable to locate the testator after a diligent search.
Recent developments in federal tax
On August 22, 2005 the Service issued eight Revenue Procedures setting forth sample trust language for charitable remainder unitrusts.
Removal of a guardian
As the median age of our population increases, it is likely that the number of guardianships will also increase.
A review of the final regulations under Circular 230
Estate planning practitioners face the prospect of fines, censure, suspension and disbarment from practice before the IRS for violations beginning June 20, 2005-Further regulations issued on May 18, 2005 (see last page) help to clarify some of the problem areas.
Revised Form 1023: What it means for new charitable organizations
In order to qualify for exemption from Federal income tax, most new charitable organizations are required to file Form 1023, Application for Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code, within 27 months following the end of the month in which the organization was established.
Sample Client letter-Circular 230
With the necessity of attaching Circular 230 disclaimers to letters, faxes, and e-mail messages, comes the obligation of explaining Circular 230 to our clients.
True to form, the Tax Court overrides formula price in family business buy-sell agreements
In the October 2004 newsletter, members of this Section Council highlighted two recent cases (Estate of Blount and Estate of Smith) wherein the Internal Revenue Service ("Service") successfully applied Internal Revenue Code Section 2703 principles to disregard the restrictions provided under a buy-sell agreement between shareholders and to disregard restrictive provisions of a family limited partnership, both resulting in significantly higher valuations of the underlying property for estate and gift tax purposes.