A Nightmare in Elwood Estate by Phyllis Taite (Smith)

Phyllis Taite (Smith) has made available for download her article, “A Nightmare in Elwood Estate,” published in Tax Notes, Vol. 144, No. 4, 2014. The abstract reads as follows:

Estate of Elwood is a case involving reciprocal revocable trusts in which the Tax Court held that the estate was required under section 2044 to include the value of assets in a trust created by the decedent’s wife before her death. The decedent held a special power of appointment in the family trust to appoint to tax exempt charitable organization. The decedent also held discretionary power to distribute in the marital trust. The decedent, as personal representative, did not create the distinct separate trust as required in the trust instrument, and he made significant withdrawals without indicating the source for the withdrawals. The Tax Court was forced to allocate the withdrawn trust property between the two trusts which caused an otherwise nontaxable estate to become a taxable estate.

via A Nightmare in Elwood Estate by Phyllis Taite (Smith) :: SSRN.

Posted by Lewis J. Saret, Co-General Editor, Wealth Strategies Journal.