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Who’s Richer Than the 1%?

Who’s Richer Than the 1%?

September 11, 2015

Authored by: Stephanie Moll

ThinkstockPhotos-80614811Are you getting ready to write that big check to the IRS?  If so, you should be aware that the IRS is no longer accepting checks in amounts larger than $99,999,999.00.  In Internal Revenue Bulletin 2015-36, the IRS announced that, starting on January 1, 2016, the IRS will begin returning checks in amounts greater than $99,999,999.00 to the originator.  If you are one of the unlucky few who owe this much in tax (I might disagree and say you’re lucky to owe that much because how much do you have left after paying $100 million in tax?) you should be aware that you will have to send the IRS more than one check to make your payment.

IRS Postpones Filing Deadline for New Basis Reporting Requirements

ThinkstockPhotos-186176261As part of the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015, signed into law by President Obama on July 31, 2015, Sections 1014(f) and 6035 were enacted.

Section 1014(f) provides rules requiring that the basis of certain property acquired from a decedent may not exceed the basis of that property as finally determined for federal estate tax purposes, or, if not finally determined, as reported on a statement made under section 6035.

Section 6035 imposes new reporting requirements  for the executor of an estate of a decedent where a federal estate tax return is required to be filed.  The executor must furnish, to both the IRS and to each person who holds a legal or beneficial interest in the property listed on the estate tax return,  a statement “identifying the

Estates Must Now Request Closing Letters from IRS

ThinkstockPhotos-480130649In the past, when an estate of a deceased taxpayer filed a Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return, the Internal Revenue Service would automatically issue an estate tax closing letter, signifying that the Return had been accepted by the IRS. At that time, the estate could be assured that, unless the estate took an action that re-opened the estate tax return to review, no additional estate tax would be imposed by the IRS.

Recently, a change was made on the IRS website that indicates this procedure has been changed. Per www.irs.gov:

When can I expect the Estate Tax Closing Letter?

For all estate tax returns filed on or after June 1, 2015,

Changes in the Final Portability Regulations

Changes in the Final Portability Regulations

July 10, 2015

Authored by: Andrew Bleyer and Doug Stanley

ThinkstockPhotos-176603977The IRS issued final regulations for electing portability and use of a deceased spousal unused exclusion amount (DSUE) on June 12, 2015. Though the final regulations are fairly technical, they are worth understanding as applying them correctly can mean a $5,430,000 difference in the amount that passes through an estate tax free. The final regulations adopt the temporary regulations that were issued in 2012, with several changes and clarifications:

1. Upon request, the proposed regulations allowed for an extension of time to elect portability for those estates that did not meet the requirements for an automatic extension. It was unclear whether estates that exceed the basic exclusion amount (currently $5,430,000 indexed for inflation) could request such an extension because the filing deadline for such estates is prescribed by statute and thus cannot be modified

Same-Sex Married Couples: What to Do Now?

samesexmarriageIn light of the recent Supreme Court decision in Obergefell v. Hodges, we are re-posting this blog, which was originally posted on October 10, 2014.

We thought we’d share some of the information presented by our attorneys at the CLE presentation in our St. Louis office on Wednesday morning, “Same Sex, Different Day:  Estate Planning for Same Sex Married Couples (Post Windsor decision), co-sponsored by the Bryan Cave LGBT Affinity Group.  Presenters were Kimberly Civins, Stephen Daiker, and Douglas Stanley, along with Tony Rothert from the ACLU of Eastern Missouri.

Get income tax advice regarding amending returns and filing returns going forward

The sooner the better, as there is a 3 year statute of limitations for amending returns if filing as married achieves a better tax result!

Review of Income Tax Deduction Rules for Charitable Gifts

According to area newspaper the St. Louis Post Dispatch, one of St. Louis’ wealthiest families, that of Enterprise Holdings founder Jack Taylor, is making some very large charitable donations this week–a total of $92.5 million to 13 cultural institutions and charities, most local to St. Louis.

In light of this, we thought now would be a good time to remind everyone of some of the basic income tax deductions available for gifts to charities.

Section 170 of the Internal Revenue Code (the “Code”) governs income tax deductions for charitable contributions. In the case of an individual making a cash gift to a Section 501(c)(3) organization classified as a “public charity” (such as churches, schools, hospitals, and governmental units), the gift is deductible for federal income tax purposes so long as the aggregate gifts do not exceed fifty percent (50%) of the taxpayer’s adjusted gross income (“AGI”) for the taxable year.

Treasury Green Book Proposal: Reversion to 2009 Laws

459482489The Treasury Green Book provides explanations of the President’s budget proposals.  One such proposal (remember…these are just proposals, not actual changes in the law) that may affect your estate planning is found on page 193 of the Green Book and is re-printed here for your convenience:

RESTORE THE ESTATE, GIFT, AND GENERATION-SKIPPING TRANSFER (GST) TAX PARAMETERS IN EFFECT IN 2009

Current Law

The current estate, GST, and gift tax rate is 40 percent, and each individual has a lifetime exclusion of $5 million for estate and gift tax and $5 million for GST (indexed after 2011 for inflation from 2010). The surviving spouse of a person who dies after December 31, 2010, may be eligible to increase the surviving spouse’s exclusion amount

Treasury Green Book Proposal: Limit Duration of GST Tax Exemption

459482489The Treasury Green Book provides explanations of the President’s budget proposals.  One such proposal (remember…these are just proposals, not actual changes in the law) that may affect your estate planning is found on page 200 of the Green Book and is re-printed here for your convenience:

LIMIT DURATION OF GENERATION-SKIPPING TRANSFER (GST) TAX EXEMPTION

Current Law

GST tax is imposed on gifts and bequests to transferees who are two or more generations younger than the transferor. The GST tax was enacted to prevent the avoidance of estate and gift taxes through the use of a trust that gives successive life interests to multiple generations of beneficiaries. In such a trust, no estate tax would be incurred as beneficiaries died, because their

Treasury Green Book Proposal: Definition of Executor

459482489The Treasury Green Book provides explanations of the President’s budget proposals.  One such proposal (remember…these are just proposals, not actual changes in the law) that may affect your estate planning is found on page 206 of the Green Book and is re-printed here for your convenience:

EXPAND APPLICABILITY OF DEFINITION OF EXECUTOR

Current Law

The Code defines “executor” for purposes of the estate tax to be the person who is appointed, qualified, and acting within the United States as executor or administrator of the decedent’s estate or, if none, then “any person in actual or constructive possession of any property of the decedent.” This could include, for example, the trustee of the decedent’s revocable trust, an IRA or life insurance beneficiary,

Treasury Green Book Proposal: Consistency in Values

459482489The Treasury Green Book provides explanations of the President’s budget proposals.  One such proposal (remember…these are just proposals, not actual changes in the law) that may affect your estate planning is found on page 195 of the Green Book and is re-printed here for your convenience:

REQUIRE CONSISTENCY IN VALUE FOR TRANSFER AND INCOME TAX PURPOSES

Current Law

Section 1014 provides that the basis of property acquired from a decedent generally is the fair market value of the property on the decedent’s date of death. Similarly, property included in the decedent’s gross estate for estate tax purposes generally must be valued at its fair market value on the date of death. Although the same valuation standard applies to both provisions, current

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