Tag Archives: income tax

Tax Reform: Congressional Republicans Release Proposed Tax Bill

Finally we have something to look at in the movement toward tax reform. At the end of this post there are two links (1) a 90 page “summary” of the tax reform bill and (2) the tax reform bill known as the Tax Cut and Jobs Act.

On a quick perusal of the 425 page bill, the thrust of the bill is as follows:

  • Increase standard deduction
  • Fewer income tax brackets
  • Many deductions eliminated (the charitable and mortgage interest deductions are essentially intact)
  • Reduced corporate tax rate to 20%
  • Reduced non-corporate business tax rate to 25%
  • Elimination of the Alternative Minimum Tax
  • Estate and Gift Tax exemption increased to $10,000,000 per person
  • Phase out of Estate and Generation Skipping Taxes to repeal after 2023
  • Retention of step-up income tax basis upon death

Continue reading Tax Reform: Congressional Republicans Release Proposed Tax Bill

Teaching that Old Trust New Tricks: Modifying, Amending or Terminating an Irrevocable Trust

Old Dog New TrickArkansas, Mississippi and Tennessee have each adopted the Uniform Trust Code (or some form of it).

One of the many things that the Trust Code has enabled practitioners to do is to change or perhaps simply “freshen” an old irrevocable trust.  With the Death Tax exemptions being so high, many of these old trusts are no longer needed—at least not for their original purpose.  Some of these changes require judicial approval, but many do not.

Modify to Achieve Income Tax Savings.  Lets take that old trust set up under Dad’s Will to use his tax exemption for Mom (still living).   Maybe Mom’s estate is not going to incur death taxes even if you took Dad’s trust into account.  Maybe the trust holds assets with low tax basis.

Continue reading Teaching that Old Trust New Tricks: Modifying, Amending or Terminating an Irrevocable Trust

The Death Tax: A primer on Federal and State Estate and Gift Taxes.

First, let me say that the Death Tax no longer affects the vast majority of Americans.  You probably do not have to worry about this.  I wish you did, because that would mean you were doing pretty well in life.  First world problems!

Continue reading The Death Tax: A primer on Federal and State Estate and Gift Taxes.