In March 2014, I commented on the US Tax Court decision in the Frank Aragona Trust case. In that case, the tax court disagreed with the Internal Revenue Service’s arguments that a trust was incapable of providing “personal services” to meet the material participation test under IRC § 469 (c)(7). In November 2013, when the … Continue Reading
Each day, family offices receive, relay, and manage a family’s private information. Depending on the family and the role of the family office, the information managed can be voluminous and include financial information, tax identification numbers, account numbers, health and health insurance information, estate planning documents and even home security system information. Oftentimes, the family … Continue Reading
On March 20, 2014, the Colorado Court of Appeals, in Malias v. Malias, upheld the trial court’s determination that grantor retained annuity trust (GRAT) remainder interests were “property interests” for property division purposes, and the corresponding valuation of the GRAT interests for those purposes. Although the case has not yet been selected for publication, it … Continue Reading
Because trusts are subject to the 3.8% Net Investment Income Tax at a very low income level, $12,150 for 2014, trustees of trusts owning interests in operating entities have been considering ways to meet the material participation requirements to avoid this tax. As discussed in a prior post, differing points of view have arisen regarding … Continue Reading
As discussed in a prior post, one of the helpful provisions recently added to federal estate tax law allows a surviving spouse to use any “leftover” or “unused” federal estate tax exclusion amount of a deceased spouse. The federal estate tax exclusion amount will increase to $5.34 million for 2014 (to be adjusted for inflation … Continue Reading
Toward the end of 2012, many families with wealth tied to a family business were faced with a choice: 1) avail themselves of the expiring $5.12 million estate and gift tax exemption by gifting interests in their family businesses; or 2) maintain the status quo and risk losing the tax savings opportunity. Many families who … Continue Reading
