Marital deduction planning for noncitizen spouses

Article Abstract:

Use of the qualified domestic trust (QDOT) makes it possible to obtain a marital deduction on the estate tax even when the surviving spouse is a foreigner. The QDOT must meet the requirements of IRC 2056A, which also defines the 'taxable events' for such a trust. The QDOT must be created before the decedent's inheritance tax return is filed. Multiple QDOTs will be best able to minimize taxes if they have a US trustee whose duty it is to file all QDOT tax returns and pay taxes.

Planning, Finance, Husband and wife, Husband-wife relations, Marital deduction

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Assessing the uses of the electing small business trust

Article Abstract:

Electing small business trusts are useful vehicles for tax and estate planning due to the allowance of broad and multiple beneficiary designations and income spraying. Such trusts are flexible planning vehicles which allow for the ownership of S corporation stock and are superior to the more limited qualified Subchapter S trusts. Income tax issues need to be resolved through further law reform in this area.

Estate Planning, Trusts, Funds, Trusts, and Other Financial Vehicles, United States, Usage, Small business, S corporations

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Proposed regulations clarify QDOTs but add new requirements

Article Abstract:

The IRS has issued proposed regulations under IRC section 2056A covering qualified domestic trusts (QDOTs). The rules are an improvement which allows benefits from retirement plans or annuities to qualify under QDOTs for the first time. However, there are new burdens related to deferred estate tax collection. Annual statements must be filed by trustees to prove that QDOT rules are satisfied.

Laws, regulations and rules, Transfer taxes

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