Chad Makuch

Same-Sex Spouses Authorized to Recalculate Transfer Tax Treatment of Prior Gifts and Bequests

By Chad Makuch on January 20, 2017 Posted in Tax

The IRS recently issued Notice 2017-15 to provide same-sex spouses relief to recalculate the federal estate, gift and generation-skipping transfer (GST) tax treatment of gifts and bequests made before the Defense of Marriage Act (DOMA) was deemed unconstitutional. DOMA defined “marriage” and “spouse” to the exclusion of same-sex couples for purposes of federal law, including … Continue Reading

IRS Regulations Clarify Definition of Spouse for Federal Tax Purposes in Light of Obergefell v. Hodges

By Amanda Tate and Chad Makuch on October 18, 2016 Posted in Estate Planning, Estate Tax, Tax

The IRS has issued final regulations clarifying the definitions of “spouse,” “husband,” “wife,” and “husband and wife” for federal tax purposes. The final regulations now define “spouse,” “husband” and “wife” as any individual lawfully married to another individual, and “husband and wife” as any two individuals lawfully married to each other, regardless of the individuals’ … Continue Reading

IRS Plans to Further Restrict Family Business Valuation Discounts

By Chad Makuch on August 21, 2015 Posted in Estate Tax, Tax

IRS regulations anticipated for release as early as this September may further restrict valuation discounts. The exact scope of the regulations is unknown, but the regulations will likely make it more difficult for taxpayers to discount the value of family business interests. Valuation Discounts Generally Valuation discounts in family business interests are often utilized in … Continue Reading

U.S. Supreme Court Agrees to Hear Cases Regarding the Constitutionality of Same-Sex Marriage Bans

By Chad Makuch on January 26, 2015 Posted in Estate Planning

The U.S. Supreme Court has agreed to hear four cases from Ohio, Michigan, Kentucky, and Tennessee, respectively, regarding the constitutionality of same-sex marriage bans by the states. While the Court’s decision to hear the cases was anticipated (as previously discussed here), the decision is nonetheless exciting. Arguments are expected to be presented in April of … Continue Reading

U.S. Supreme Court Now Likely to Rule on Constitutionality of Same-Sex Marriage Bans

By Chad Makuch on December 2, 2014 Posted in U.S. Supreme Court

To date, the U.S. Supreme Court has declined to rule on the constitutionality of state laws banning same-sex marriage. Even in the U.S. Supreme Court’s landmark decision in U.S. v. Windsor (discussed here), the U.S. Supreme Court left to the states the authority to define and regulate marriage. In addition, as recently as October 6, … Continue Reading

Income Tax Reporting for Decanting

By Chad Makuch on June 20, 2014 Posted in Estate Planning, Income Tax, Tax, Trust Administration

Decanting refers to the distribution of trust property of one trust (the “first trust”) to another trust (the “second trust”). Over the past several years, the number of states specifically authorizing decanting by statute has grown rapidly. As of March 2014, at least twenty-two states have passed or proposed a state decanting statute. Notwithstanding this … Continue Reading

International Grant-Making: Best Practices for U.S. Public Charities

By Chad Makuch on February 20, 2014 Posted in Tax

U.S. public charities are blessed, but also challenged, by a relative lack of regulation governing their grants to foreign persons and foreign entities. U.S. public charities are blessed by this lack of regulation because the rules applicable to them when making grants are fairly simple, flexible and easy to understand, particularly when compared to the … Continue Reading

The Limits of Discretion: Trust Distributions for Health, Education, Maintenance and Support

By Chad Makuch and Dan McClain on September 10, 2013 Posted in Estate Planning, Trust Administration

Trustees are often granted the power to distribute trust property “in the Trustee’s discretion” for a beneficiary’s “general well-being,” “best interests,” “comfort,” or, most commonly, “health, education, maintenance and support.” This “health, education, maintenance and support” distribution standard is so common that most trustees and other trust advisors refer to it simply as the “HEMS” … Continue Reading

Careful Estate Planning Required When Transferring S Corporation Shares to Trusts

By Chad Makuch, Dana Andrassy and Lisa Roberts-Mamone on August 16, 2013 Posted in Estate Planning, Tax, Trust Administration

S corporation shareholders must be careful not to inadvertently terminate their closely held company’s S election when engaging in estate planning. Closely-held entities, which choose not to be formed as a partnership or limited liability corporation, often elect to be taxed as an S corporation under the Internal Revenue Code to avoid the double taxation … Continue Reading

U.S. Supreme Court Rules DOMA Unconstitutional in Estate Tax Case

By Chad Makuch on June 27, 2013 Posted in Estate Planning, Estate Tax, Tax

The Supreme Court has held that the Defense of Marriage Act (“DOMA”) is unconstitutional. DOMA defined “marriage” and “spouse” to the exclusion of same-sex partners for purposes of federal law. As a result, same-sex partners (even those legally married or otherwise legitimized under state law) were not considered married or to be spouses for purposes … Continue Reading

The Proliferation of Trust Decanting Statutes Continues

By Chad Makuch on June 17, 2013 Posted in Estate Planning, Tax, Trust Administration

Irrevocable trusts are now subject to varying degrees of amendment by court approved modifications, trust protector actions, private settlement agreements, and, of course, decanting. Effective July 1, 2013, Wyoming will become the nineteenth state (and the ninth state since 2010) to permit trust decanting by statute. Decanting refers to the distribution of trust property of … Continue Reading