Archive for the ‘Trusts’ Category
Posted by William Byrnes on July 18, 2013
The “irrevocable” label might have some clients feeling like they are locked into previously established irrevocable trusts for life, which might not always be the case. There are many reasons why a client might remain interested in preserving an irrevocable trust, but after the fiscal cliff deal made the generous $5 million estate tax exemption and spousal portability permanent, there are equally strong reasons why a client might prefer to terminate. …
The choice to terminate will force clients to reevaluate insurance and other trust held assets and lead to what are often long overdue replacement or reallocation discussions.
When Can an Irrevocable Trust Be Terminated?
Read the full analysis at ThinkAdvisor: http://www.thinkadvisor.com/2013/06/17/the-not-so-irrevocable-trust-unlocking-trust-asset
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Posted in Estate Tax, Taxation, Trusts, Wealth Management | Tagged: $5 million, advanced markets, estate planning, Illinois, Internal Revenue Service, law, Organizations, Tax exemption, Trust law, United States, Wealth Management | Leave a Comment »
Posted by William Byrnes on December 5, 2012
2013 Tax Facts on Investments in PRINT and E-Book format 
provides clear, concise answers to often complex tax questions concerning investments. Pertinent planning points are provided throughout.
Organized in a convenient Q&A format to speed you to the information you need, 2013 Tax Facts on Investments delivers the latest guidance on:
- Mutual Funds, Unit Trusts, REITs
- Incentive Stock Options
- Options & Futures
- Real Estate
- Stocks, Bonds
- Oil & Gas
- Precious Metals & Collectibles
- And much more!
Key updates for 2013:
- New section on captive insurance
- New section on reverse mortgages
- Expanded section on ETFs
- Expanded section on precious metals & collectibles
- More than 30 new Planning Points, written by practitioners for practitioners, in the following areas:
- Real Estate
- Limited Partnerships
- Stocks
- Interest and Expenses
- Options
- Mutual Funds
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Posted in Estate Tax, Retirement Planning, Taxation, Trusts, Wealth Management | Tagged: 2013 Tax Facts, Business, Economy, Exchange-traded fund, futures real estate, incentive stock options, Investing, Investment, Mutual fund, Precious metal, Real estate investment trust, real estate limited partnerships, stocks bonds, tax, Wealth Management | Leave a Comment »
Posted by William Byrnes on November 21, 2012
For your clients who have been playing the wait-and-see game in estate planning this year, the time for waiting is over. Absent congressional action, the current $5.12 million exemption will revert to $1 million in less than three months, and the current 35% maximum estate tax rate will jump to 55%. The entire article is available at http://www.lifehealthpro.com/2012/10/17/the-ticking-estate-tax-time-bomb-less-than-90-days
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Posted in Estate Tax, Pensions, Retirement Planning, Taxation, Trusts, Wealth Management | Tagged: estate planning, Inheritance tax, tax, Tax exemption | Leave a Comment »
Posted by William Byrnes on March 19, 2011
You’d better think twice before agreeing to act as trustee for your clients’ trusts, since doing so can cost you far more than the goodwill and fees it generates.
We all know that, depending on the circumstances, a trust, its grantor, or its beneficiaries can be held responsible for tax liability stemming from trust income.
What about its trustee?
Although trustees are not usually personally responsible for a trust’s taxes, a trustee can be stuck with the tax bill if the trustee breaches his or her fiduciary duty to the beneficiaries. A U.S. District Court recently considered a trustee’s liability for GST taxes when the trust’s beneficiaries claimed that the trustee failed to keep them informed of their potential liability for taxes stemming from trust distributions.
The trustees’ mistake in this case could cost them over $1 million. Read the full analysis by linking to AdvisorFX!
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Posted in Trusts | Tagged: accounting, Beneficiary, Fiduciary, tax, Taxation, Trust law, Trustee, United States | Leave a Comment »
Posted by William Byrnes on February 17, 2011
A recent Delaware Court of Chancery decision illustrates the severe consequences that can befall an insurance agent trustee who violates his or her duties to the trust’s beneficiaries. The agent in the case agreed to serve as trustee of a client’s life insurance trust.
The client, a Father, had a falling out with his son over the Father’s marriage to a woman 17 years his junior. Nevertheless, the Father and his second wife formed a trust for the benefit of the son. The couple asked their family insurance agent to serve as trustee of the trust. The trust purchased a second-to-die life insurance policy on their lives. Although the trust was irrevocable, the Father ad young wife asked the trustee to revoke the trust only three years after it was formed. The trustee intelligently refused to revoke the trust, but did agree to loan the policy’s cash value to the couple.
Read this complete analysis of the impact at AdvisorFX (sign up for a free trial subscription with full access to all of the planning libraries and client presentations if you are not already a subscriber).
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Posted in Trusts | Tagged: Business, Delaware Court of Chancery, Financial services, Fred Wilpon, insurance, Lawsuit, Trustee, United States | Leave a Comment »
Posted by William Byrnes on February 8, 2011
Recently some wealth managers have established trustee services with regards to retirement accounts. It’s a good fit, generally, when the wealth manager can offer clients information regarding deductible contributions to a retirement account, and further act as a fiduciary vis-à-vis trustee of those funds.
What are the basic requirements in order to act in the capacity as a trustee for IRA and other retirement account purposes?
First, an Individual Retirement Account (IRA) must be a trust created or organized in the United States for the exclusive benefit of an individual or his beneficiaries. Such trust must be maintained at all times as a domestic trust in the United States. The instrument creating the trust must be in writing.
Secondly, the trustee of an IRA trust may be a person other than a bank if the person demonstrates to the satisfaction of the Commissioner of the Internal Revenue Service that the manner in which the person will administer trusts will be consistent with the requirements of the tax code. The person must submit a written application including the information discussed below. Read further at AdvisorFYI
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Posted in Pensions, Trusts | Tagged: Individual Retirement Account, Internal Revenue Service, Retirement, Roth IRA, tax, Trust law, Trustee, United States | Leave a Comment »
Posted by William Byrnes on September 23, 2010
The traditional private annuity is a transaction used by some wealth managers for clients whose circumstances permit. Generally a private annuity transaction occurs where the grantor transfers assets to a third party who pays the grantor an annuity, usually for the life of the grantor.
When a trust is involved with a traditional private annuity, the common transaction may look like this: “The owner of highly appreciated commercial real estate transfers the property to an irrevocable trust in exchange for the trust’s promise to pay an annuity for life. The present value of the annuity equals the fair market value (‘FMV‘) of the property. The trust then sells the property to a third party for a sale price equal to its FMV.” For additional introductory discussion on private annuity contracts see AUS Main Private Annuity.
Planning Concept: Some wealth managers have recently begun to structure private annuities for their clients slightly differently than the traditional methods. For a discussion and analysis, please see AdvisorFYI
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Posted in Estate Tax, Insurance, Trusts | Tagged: annuities, Business, Contract, Financial services, insurance, Life annuity, Pension, Real estate | Leave a Comment »
Posted by William Byrnes on September 22, 2010
Why is this Topic Important to Wealth Managers? Discusses estate tax considerations in regards to life insurance policies. Also, includes a detailed dialogue of the incidents of ownership concept.
What do most wealth managers try to avoid when planning with life insurance and trusts?
That the Gross Estate for Estate Tax calculations would include the death benefit from the policy in the estate.
What are some common ways to avoid this dilemma when using a trust and life insurance in regards to estate planning?
For the answer to this question, and planning analysis, see the blogticle at AdvisorFYI
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Posted in Estate Tax, Insurance, Trusts | Tagged: Business, Death, estate planning, Estate tax in the United States, Insurance policy, law, life insurance, United States | Leave a Comment »
Posted by William Byrnes on September 21, 2010
Why is this Topic Important to Wealth Managers? The terminology associated with common estate planning techniques is generally misguided. Provides a better understanding of the tax and legal implications, on behalf of the client’s estate plans, of trusts that purchase life insurance.
One commentator states “If the practitioner would examine either the Internal Revenue Code or the Treasury Regulation designed to interpret the Code, they will not find the use of the term ‘Insurance Trust’ or the term ‘ILIT.’” For a detailed analysis of the ILIT see the Main Library Section 4. Estate Planning Techniques H—Life Insurance Trusts.
For the complete blogticle and its analysis, see AdvisorFYI
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Posted in Estate Tax, Insurance, Trusts | Tagged: Business, estate planning, Internal Revenue Code, life insurance, Life insurance trust, tax, Treasury Regulation, United States | Leave a Comment »
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