Planning for the family-owned business exclusion under TRA '97

Article Abstract:

The Taxpayer Relief Act of 1997 added IRC section 2033A which contains the 'family-owned business exclusion' allowing estates of decedents dying after 1997 an additional exclusion if the complex and stringent requirements are met. The $1.3 million exclusion is reduced by being indexed against the general exclusion and phased-down for a period of ten years. The exclusion does provide tax relief for those who can meet and maintain the ownership and use requirements. Suggestions for drafting testamentary documents are provided.

Tax exclusion

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Sauce for the goose? IRS rejects discount based on aggregating separate gifts

Article Abstract:

The IRS has not permitted a blockage discount on multiple gifts of stock from a single donor. The donor had given publicly-traded stock to several trusts created for the donor's grandchildren, and claimed the stock transfers as separate gifts. The IRS ruled the blockage discount is applicable when the size of the block is very large compared to the number of shares changing hands. Although the IRS has not ruled consistently on this issue, their ruling appears to be sound in this instance.

Stocks, Trusts and trustees, Trustees, Trusts (Law), Valuation, Gift tax

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Back to basics for the family limited partnership

Article Abstract:

The author discusses estate and tax planning benefits and IRS auditing problems concerning family limited partnerships. The Tax Court cases Estate of Reichardt and Estate of Schauerhamer are the focus of the discussion.

United States, Transfer taxes, Limited partnership, Limited partnerships

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