For “Intentionally Defective” Grantor Trusts (Part II of II) In this second and final part of this article, the author provides illustrations that showcase pitfalls to avoid when the power of substitution is exercised. Read Part I here.
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For “Intentionally Defective” Grantor Trusts (Part I of II) The power of substitution is held by the settlor of a grantor trust if this power is provided by the trust instrument. This power allows the settlor, at any time, to remove an asset or assets from the grantor trust in exchange for an asset or assets of equivalent value. Such a transfer can be problematic and vulnerable to challenge if the equivalent value is questionable. One such example is when a promissory note bearing a below-market interest rate is the substituted property. First, this discussion presents an analysis of the…
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Try this Tactic to Minimize Generation-Skipping Taxes Generation-skipping taxes and other issues can complicate the process of transferring wealth from one generation to another. William Kriesel, CPA, PFS, explains how giving relatives a partnership interest in a family business can overcome some of these challenges. To read the full article in The CPA Journal, click: Accomplishing Estate Planning Goals through the Use of Partnership Income Tax Rules.
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Ways 16 through 30 (Part II of II) This is the second part of this two-part article where the author presents fifteen other structures owners may want to consider as part of a succession plan. Click here to read part one.