Estate & Trust Blog

Informing and Updating

Relief for Late Portability Election 17-34

Each taxpayer is allowed - for federal gift, estate, and Generation Skipping Tax purposes - an exemption of $5,490,000 (for 20017 - the amount adjusts annually). For decedents' estates who do not take full advantage of the exemption, the IRS Code allows - for gift and estate tax, but not for Generation Skipping Tax - any unused exemption to be "ported" to the decedent's surviving spouse. This "portability" must be elected by the estate of the first spouse to die on a timely filed federal estate tax return. The IRS, in Revenue Procedure 2017-34, had announced that it will allow - for estates of certain decedents that are not otherwise required to file a federal estate tax return - the electi

Residence and Domicile

It is widely known that many states do not impose estate tax. Here in the Northeast, it is common to hear someone say that she is a Florida resident, and thus (i) pays no income tax and (ii) will avoid state estate tax. True enough, if actually a resident and domiciliary. Residence for income tax purposes and for estate tax purposes are based on separate factual considerations. Income tax residence tends to be based on facts (e.g., number of days in a state) while a person's domicile for estate tax is "the place the person intends to stay in/return to on a permanent basis" - a subjective standard, determined based on objective indicators. Massachusetts, for example, requires in certain cir

GSTT Tax Returns

The Generation Skipping Transfer Tax was instituted in 1986. Events and Transfers subject to this tax occur in various situations. And when they occur (even if there is no tax due) GSTT tax returns are required. Worse, if there is tax, the trustee may have personal liability for unpaid tax. It is now 2017 - the tax has been in effect for 31 years (well, with one year off in 2010!). So-called "taxable events," which require reporting, are starting to occur, and frequency will increase. If you are a trustee or a trust beneficiary, this tax, and its filing obligations, should be on your radar. This blog is not intended to constitute, and does not constitute, legal advise to anyone or any speci

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