The newsletter of the ISBA’s Section on Trusts & Estates
Browse articles by year: 2014 (15)
Newsletter articles from 2009
Ahoy, Ahoy! A Tax Bill on the Horizon
In a bi-partisan effort, U.S. Representatives Mark Kirk (Republican) and Harry Mitchell (Democrat) introduced H..R. 498 ( “Tax Bill”), legislation designed to address the problems with the estate tax and capital gains tax. But in order to become law this bill still has a few significant hurdles to pass.
Appraisal opportunities and challenges in down markets
By understanding the approach of appraisers to determining the value of closely held business in the current market conditions, estate planners can better service their clients during the market downturn.
Bonds and the original issue discount: Easy does it
With the investment landscape changing investors have shown interest in more secure and conservative investment vehicles. Many clients have expressed an interest in bonds. However, the complexity of the varying bond vehicles and the income tax implications is often something that clients fail to understand.
Choosing a Roth IRA
The ultimate consideration in deciding whether to choose a Traditional or Roth IRA generally becomes whether you would rather pay tax now or later.
It has become difficult to keep track of the plethora of tax laws passed in the last decade. Check out our chart, available at <http://www.isba.org/sections/trustsestates/9-09table.pdf>, which illustrates the complexity of attempting to coordinate the various tax laws. ■
Estate planning in a low-interest-rate environment
This article discusses the mechanics of techniques such as intra-family loans, SCINs, installment sales to grantor trusts, GRATs, CLATs and charitable gifts of personal residence remainders, and how they flourish in a low-interest environment.
If you have blown the Statute of Limitations, the 1st District says just extend it to meet your own needs.
Ethics corner: Careful with capacity
ACTEC commentary on clients with diminished capacity, specifically Model Rule of Professional Conduct (MRPC) 1.14, provides additional guidance to the estate planning practitioner. Specifically, the commentary provides advice on how to address the various disability determinations that a lawyer may encounter: a client whose testamentary capacity is uncertain, borderline, or doubtful.
The fine art of fine art investments
Investing in art can be an exciting opportunity for many individuals to make great profit, diversify a portfolio, and to add aesthetic beauty to an individual’s home. But as with all investments, engaging in the collection of art for investment purposes carries its own unique risks that should thoroughly investigated and evaluated.
Foundational changes for private foundations: All gains and no losses
After this year, private foundations may not carry capital losses forward to future years. However, these rules only apply to losses. There is no rule blocking recognition of gains. This tax change has the effect of “stepping up” the foundation’s cost basis in appreciated securities to fair market value tax-free. If foundations have realized capital losses in their foundations’ portfolios, they should consider whether to sell securities to realize an offsetting capital gain before year-end.
A GRAT way to transfer wealth. Well, at least for now…
If you possess assets that are appreciating fast (or at least you think they will), the GRAT is simply one of the most effective ways of transferring value at a low cost. The future of this technique is not clear, however, as proposed legislation could render it ineffective.
New virtual representation law
SB 188 passed both houses of the Illinois legislature with no dissenting votes. When signed by the Governor, the new law will become effective January 1, 2010. This new law originated from the ISBA Trusts and Estates Section Council.
Planning for post-EGTRRA wealth transfer taxes
As the days wane on the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA), the legislation’s final act would be to repeal the estate and GST taxes altogether in 2010, while retaining the gift tax along with a $1 million gift tax exclusion and a maximum rate of 35 percent.
A private annuity can be an effective way of transferring wealth to a family member, freezing the estate, avoiding estate and gift tax, and ensuring a lifetime stream of income.
Probate Act problems in proving up wills
This article examines the problem that arises when a petitioner must rely on a witness attestation clause to admit a will in a “formal proof” hearing under the Probate Act.
The Safety GRAT™
Many clients believe that the greatest enemy to their wealth is the federal estate tax. The reality is that very few estates actually pay a federal estate tax and current estimates are that fewer than 20,000 estates annually will actually pay the federal estate tax. Furthermore, it is understood that quality estate planning can materially reduce, if not eliminate, any tax due.
Should Illinois adopt the TOD deed?
Transfer on death of securities has worked well in Illinois for many years, so why not extend the transfer-on-death concept in Illinois to real estate and thereby allow a named beneficiary in a TODD to take direct ownership of real estate upon the grantor’s death? Let’s take a closer look at the TODD concept?
Strategic planning in divorce
This article is designed to get estate planners on par with some of the thought processes and strategies used by matrimonial attorneys during this economic crisis.
T & E Ethics Corner
Some guidelines for jointly representing spouses in estate planning.