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Estate Tax Planning

David Grant as One of the “Notable Faces in Southern Nevada’s Financial Community.”

Estate Planning Attorney David Grant was recently featured in the February 3, 2014 issue of VegasInc Magazine as one of the “notable faces in Southern Nevada’s financial community.” You can read the full article here http://www.vegasinc.com/business/2014/feb/03/get-financial-adviser-avoid-small-business-headach/. Congratulations David!...

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The Recent Tax Act: The Bell Tolls for Thee

The English poet, John Donne, many years ago wrote, “Send not to know for whom the bell tolls.  It tolls for thee.” Donne eloquently made the case that a loss to anyone is a loss to all. Similarly, although you may not see an immediate increase in your taxes as a result of the so-called “American Taxpayer Relief Act,” the overall economic impact of the tax increases under the Act will, in some ways, impact us all. Following is a smattering of some of the changes in the tax law arising from the new tax law: The top income tax rate...

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Donating Appreciated Stock

(Republished in part from Vegas PBS Source Magazine, October 2011) Donating appreciated stock to charity is a sure way to generate a little tax relief for yourself.  If you do decide to donate stock, here are a few important points to consider before making your gift. Make sure the stock has appreciated.  If the stock has fallen in value since you purchased it, you may be better off selling the stock first to generate a capital loss.  Then, if you desire, you can donate the proceeds to charity. Select long-term stock. If you have owned the stock for more than one year before making...

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Community Property vs. Separate Property for Estate Planning

Community Property. Community property is everything that a husband and wife own together. Nevada is a community property state. This means both the husband and wife equally own all money earned by either one of them from the beginning of the marriage until the date of separation. In addition, all property acquired during the marriage with "community" money is owned equally by both the wife and husband, regardless of who purchased it.  Like community assets, all debts contracted from the beginning of the marriage until the date of separation are community debts. Therefore, each spouse is equally liable for debts. A full...

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What is Estate Tax Portability?

Before 2010, married couples could pass on up to two times the federal estate tax exemption by including "A-B Trusts" or "A-B-C Trusts" in their estate plan. Because TRA 2010 was a temporary law, many wondered if portability was a concept that would only work for those dying in 2011 and 2012.  We can stop wondering.  The “American Taxpayer Relief Act of 2012” (ATRA) is now "permanent" law.  Under ATRA, portability is a constant principal going forward. Now married couples may use “portability” to add any unused portion of the estate tax exemption of the first spouse to die to the...

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Can a Trust Own an S Corporation Stock?

[vc_row triangle_shape="no"][vc_column][vc_column_text] Many people ask if a trust can own S Corporation stock. In general, living trusts and testamentary trusts may hold S corporation stock only for two (2) years after the date of death of the grantor.  After death, the trusts become ineligible shareholders and the corporation will lose its S-election due to the Grantor's death. While the grantor of a living trust is living, the Trust would be qualified as a "grantor trust" for income tax purposes, thus allowing all items of income and expense to flow through to the trust's grantor.  Upon death, the grantor trust status is switched off.[/vc_column_text][vc_empty_space][/vc_column][/vc_row][vc_row...

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Qualifying Domestic Trust (“QDOT”)

A Qualifying Domestic Trust, or QDOT, allows taxpayers who are not U.S. citizens to claim the marital deduction for estate tax purposes, while keeping the property in trust for other future contingent beneficiaries.  A non-citizen spouse is not otherwise eligible for the marital deduction.  QDOTs can be used when trust assets would likely be subject to the federal estate tax (married couple with taxable estate greater than $5 million), without the marital deduction otherwise being available.  Otherwise, without a QDOT, the surviving spouse must become a U.S. citizen before her deceased spouse’s estate tax return is filed. QDOT Requirements.  The following...

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The Nevada Onshore Trust: It’s Also An Estate Tax Planning Tool

A full copy of Mr. Grant's article can be found here: The Onshore Trust as an Estate Tax Planning Tool. In his article he answers the question, what is an onshore trust?  He also explains the benefits and downsides of using an onshore trust vs. an offshore trust.  The article also examines some tax planning ideas to be considered as one goes about forming a Nevada onshore trust or self-settled spendthrift trust, as they are sometimes called.  Lastly, Mr. Grant provides some estate planning techniques and suggestions. This article, The Onshore Trust as an Estate Tax Planning Tool, was written by David Grant while he was...

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Don’t Forget about Annual Exclusion Gifting

As published yesterday in LISI Estate Planning Newsletter #2056 (January 30, 2013).* With all eyes focused on a potential “fiscal cliff” in the last quarter of 2012, some might have missed the IRS’ October 18, 2012 announcement of an increase in the gift amount allowable under the annual exclusion.  See Rev. Proc. 2012-41.  In 2013 a person will be able to give $14,000 to each donee, free of gift tax.  While as of late planners have largely been concerned with helping clients make larger gifts under the unified credit, this announcement reminds us of our old friend—the annual exclusion.  This article...

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$5,250,000: the 2013 inflation adjusted gift/estate/GST exemption

The IRS announced yesterday in Rev. Proc. 2013-15 (see page 11, item 13), that the 2013 inflation-adjusted exemption equivalent of the unified credit is $5,250,000.  In other words, for an estate of any decedent dying during calendar year 2013, the basic exclusion amount is $5,250,000 for determining the amount of the unified credit against estate tax under Internal Revenue Code §2010.  This amount is up $130,000 from 2012 when the total exemption equivalent was $5,120,000....

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