Abstracts » Law

New prop. regs. challenge accelerated charitable remainder trusts

Article Abstract:

The authors discuss IRS Proposed Regulations which will severely limit tax planning techniques using accelerated charitable remainder unitrusts where loans or forward sales result in nonrecognition of gain. The regulations include provisions for penalties and recharacterizations of transactions and are effective for trust distributions made after Oct. 18, 1999.

Charitable remainder trusts, Recognition of gain or loss (Taxation), Tax evasion, Recognized gain or loss (Taxation)

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Prop. regs. clarify treating revocable trust as part of estate

Article Abstract:

The authors discuss tax regulations under IRC section 645, which clarify the income tax treatment of revocable trusts as part of decedents' estates.

Income tax, Revocable trusts

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Recent developments highlight IRS challenges to FLPs

Article Abstract:

IRS disfavor of the use of family limited partnerships (FLPs) as will substitutes and tax avoidance mechanisms has the potential to extend to legitimate FLP transactions. FLPs can be valuable family business planning tools which include tax advantages. Several IRS letter rulings have disregarded the partnership entity for estate tax valuation purposes in cases where the FLPs were created in close proximity to death. IRC sections 2703 and 2704 were relied upon in these rulings for transferred business asset valuation purposes.

Partnerships, Valuation, Limited partnership, Limited partnerships, Family-owned business enterprises, Family-owned businesses

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