Joshua Tree Enterprises

Sign Up for Newsletter

About this Entry

This page contains a single entry by Associate Editor published on April 26, 2012 12:05 PM.

The HYCET Trust for Moderate Millionaires was the previous entry in this blog.

PLR 201118013: Extention Granted for Return Filed on Time is the next entry in this blog.

Find recent content on the main index or look in the archives to find all content.

PLR 201216005: Estate Tax Deduction Issue for Altered Tenancy by the Entirety

TrackBacks (0)

In a Private Letter Ruling, the IRS determined that a tenancy by the entirety is broken when a "binding contract to change [any party's] legal rights and interests" is duly executed, and thus, Rev. Rul. 71-51 will not apply for purposes of the estate tax deduction for certain joint interests under I.R.C. ยงยง 2040 and 2056 in such instances.  In the PLR, a couple holding a property in a tenancy by the entirety planned on executing an agreement that would form a testamentary trust for each spouse.  The trust would hold the spouse's interest in the property upon that spouse's death.  This, of course, would be different from the mechanism under a tenancy by the entirety, in which one spouse's death triggers full and absolute ownership for the surviving spouse.  The PLR notes that Rev. Rul. 71-51 pertained to joint interests that were purportedly modified by wills.  Of course, the absolute right of survivorship in a joint tenancy supersedes testamentary dispositions, and that wrinkle is what made the situation in Rev. Rul. 71-51 different from the one in the PLR.

See PLR 201216005. h/t: Tax Notes Today

Posted by Matthew Evan Rappaport, Associate Editor, Wealth Strategies Journal

0 TrackBacks

Listed below are links to blogs that reference this entry: PLR 201216005: Estate Tax Deduction Issue for Altered Tenancy by the Entirety.

TrackBack URL for this entry: http://www.wealthstrategiesjournal.com/mt/mt-tb.cgi/6787