Estate Planning - IRC
Terms
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- 2056
- Marital Deduction
- 6161
- 12 month extension to PAY
- 6081
- Extension to FILE estate tax return
- 2518
-
Qualified disclaimer.
Treated as if predeceased.
Must be filed within 9 months. - 2001 (c)
- Rate schedule for estate tax
- 2054
- Estate tax deduction for casualty losses
- 2053
- Estate tax deductions for funeral and administration expenses
- 2032A
- This provision provides a favorable method of valuing interests in farms or certain real estate assets at the value being used, not the best or highest value
- 754
- Election to increase tax basis of flowthrough entity to reflect underlying assets
- 303
- Sales of stock that can be treated as redemptions
- 1014
- Step up in basis
- 615
-
Simple trust is one that is required to:
1) distribute all of its income currently
2) makes no distributions other than of current income, and
3) has no provision for charitable contributions. - 2035
-
Three year rule
(Only applicable to assets which may rapidly appreciate at time of death - life interests (2036), life insurance (2042), etc.)
Exception for bona fide payment. - 2042
-
Proceeds of insurance included in taxable estate if:
- "incidents of ownership"
- or if proceeds were payable to estate. - 441
- Fiscal year for estate ends 12 months after date of death
- 645
- Election to treat trust and estate as one entity for income tax purposes
- 2055
- Estate tax deduction for charitable transfers
- 101
- Insurance payable to a beneficiary is generally not includable in the beneficiary's income tax. However, transfers for value are includable, unless the purchaser is a partner of the deceased.
- 6166
- Deferral of estate taxes up to 14 years on closely held businesses
- 2010
- Credit against estate tax
- 2501 (a)
- Imposition of gift tax
- 2039
- Retirement benefits are includable in taxable estate
- 2041
- General powers of appointment are included in taxable estate. Limited powers of appointment are not.
- 2514
- General powers of appointment create taxable gifts. Limited powers of appointment do not.
- 2036 (a)(1)
-
Transfers of property over which the taxpayer retained either
(a)(1) the enjoyment, or
(a)(2) control,
over the asset during life are includable.
Exception for bona fide payment - 2652 (a)(3)
- Reverse Q-tip
- 2702
- Split interest trusts (QPRTs and GRITs)
- Subtitle B
- Estate and Gift Taxes
- 2056 (b)(7)
- Q-tip provisions
- 1362
- S corp election
- Chapter 14
- Special valuation rules
- 2038
- Taxable estate includes property when decedent posssesses power at death to alter, amend, revoke or terminate (either alone or with someone else)
- Chapter 13
- GST Tax
- 2033
-
All property owned by decedent and transferred to another as a result of death is includable in taxable estate.
This is the bulk of the estate. - Chapter 12
- Gift tax
- 2001 (a)
- Estate tax is imposed on death on all citizens or residents of the US
- Chapter 11
- Estate tax
- 2057
- Deduction for qualifying family owned businesses
- 671
- Grantor trust rules
- 72
- TTT
- 2037
-
Reversionary interests included in taxable estate. Included if:
- beneficiary must survive the transferor to possess or enjoy and
- if the transferor possesses a reversionary interest worth more than 5% prior to his death - 651
- Complex trust rules. A trust that is not a simple trust is a complex trust
- 1361 (d)
- Q-sub
- 2040
- Generally joint interests are includable unless consideration furnished (?). If H&W, it's assumed 1/2 each. See Gallenstein.
- 2032
- Taxpayer may elect alternate valuation at first to occur of 6 months after date of death or earlier postmortem disposition of property
- 2031
- Taxable estate is generally valued at fair market value at date of death
- 2043
- Consideration
- 2703
- Provides two additional rules to be added to four Wilson-Lomb requirements in order for a buy sell agreement to fix estate tax values
- Rev. Rul. 59-60
- Lists factors used to value a closely held business
- 2503 (b)
-
Annual exclusion
needs to be a present interest - Form 1023
-
Application for recognition of exemption (for non-profits)
Fee for 1023 paid on 8718 - 1014 (e)
- No full step up in basis for marital trust if gifted by non-decedent spouse within one year
- 121
-
Exclusion from sale of personal residence.
Must own and occupy residence 2 of past 5 years.
250k step up in basis per taxpayer. - 2207A
- Trustees of QTIP trust are required to pay pro rata tax on second death
- 663(b)
- 65 day rule - amounts paid within first 65 days are considered paid on last day of preceding tax year
- 663(c)
- Substantially separate and independent Shares shall be treated as separate trusts