Steve Akers, Associate Fiduciary Counsel, Bessemer Trusts, provides the following summary of developments in estate planning over the last several months.
Steve R. Akers, Fiduciary Counsel
A variety of developments over the last four months are summarized, including discussions about carryover basis, portability, and a variety of cases.
Some of the estate planning topics include:
- Carryover Basis Election: Communications from the IRS about procedures for making the carryover basis election
- Portability: An ERRATA document from the Joint Committee on Taxation suggesting a legislative change to support its position in "Example 3" of the Technical Explanation to the 2010 "Tax Relief... Act" rejecting a "privity" requirement for portability of the estate and gift exclusion amount.
- Recent Cases: Summaries of various recent cases, including (among others):
- Mayo Foundation (Supreme Court case addressing the appropriate standard for testing the validity of tax regulations),
- Linton (9th Circuit rejection of the step transaction doctrine for transfers to FLPs),
- Riese (refusing to apply § 2036 despite continued use of residence without paying rent following the end of a QPRT term)
- Saunders and Foster (addressing deduction for disputed claims and value of claim held by estate)
- Transferee Liability: Summaries of scary cases pointing out that IRS can bring collection actions against "transferees" years (or in some cases, decades) after the decedent's death even though there was never an assessment against the transferees
- Unbundling of Fiduciary Fees: IRS Notice recognizing that no "unbundling" of fiduciary fees is required for purposes of the 2% haircut rule under §67 for 2010 returns (or for any future years that begin before the §67 regulations are finalized -- perhaps suggesting that the §67 regulations will not be finalized anytime soon).
to access the summary.
Posted by Isaac Pflaum, Managing Editor, Wealth Strategies Journal