Estate Planning with Selected Issues from a Tax Perspective - v14 (Course Id 2371)

Taxes - Taxes for Course Id 2371

This exceptional course surveys wills, living trusts, gifts, marital property, and probate avoidance. Will and trust forms are explored along with living wills, durable powers of attorney, and nominations of conservator. Designed to eliminate estate problems and death taxes, the emphasis is on practical solutions that are cost-effective.

NASBA QAS - Text - NASBA Registry - IRS Enrolled Agents - 2371

As a result of studying each assignment, you should be able to meet the objectives listed below each assignment.

       At the start of Chapter 1, participants should identify the following topics for study:

* Build, preserve & distribute
* Legal documents
* Estate planning team
* Estate administration
* Transfers within probate
* Transfers outside probate
* Transfers using a trust
* Special planning tools
* Facts

1. Identify basic estate planning elements recognizing the importance of well-drafted legal documents and specify the key team participants including their roles in the estate planning process.
2. Determine the major steps in the probate process, identify ways to make transfers outside the probate system including the use of a trust, specify estate tax techniques that save death taxes while retaining maximum control, and identify estate-planning facts.

       At the start of Chapter 2, participants should identify the following topics for study:

* Taxable estate
* IRS valuation
* Estate tax return & payment
* Tax basis for estate assets
* Generation-skipping transfer tax
* Application of gift taxes and valuation
* Gift tax annual exclusion
* Gift tax marital and charitable deductions
* Gift tax advantages and disadvantages
* Shifting income & gain

1. Identify potential death taxes including federal estate tax as it applies to various size estates, specify the principal taxes that impact death taxation, and determine the expiration of the death tax credit.
2. Determine what constitutes a taxable estate under §2501 specifying what assets are included in a gross estate using basic categories of property and transfers.
3. Specify estate deductions allowed under federal estate tax law stating their tax advantages and disadvantages.
4. Determine the value of a decedent’s assets using permitted elections, recognize the use of Form 706 to pay any estate tax due, and select the tax basis and holding periods of estate assets.
5. Recall the advantages of gift planning including estate reduction recognizing the impact of the GST, specify the steps to compute gift tax identifying the gift tax exclusion amount, and determine the value of gifts including those that are split.
6. Identify the various gift tax exclusions, specify the tax treatment of below-market loans, recall the gift tax marital deduction requirements, determine the tax consequences of giving various assets specifying factors to consider when gifting, and recognize the use of Form 709 to compute and pay federal gift tax.

       At the start of Chapter 3, participants should identify the following topics for study:

* Provisions of wills
* Requirements of wills
* Executors and guardians
* Types of wills
* Title implications
* Changes to a will
* Advantages of a will
* Simple will
* Probate pros and cons
* Probate avoidance

1. Specify types of wills citing the functions a will can perform, identify types of bequests, determine the duties of executors and guardians, and recall ways to hold title and their tax ramifications.
2. Identify advantages of a properly drafted will, determine the distribution flow of simple wills, and specify the pros and cons of probate proceedings.

       At the start of Chapter 4, participants should identify the following topics for study:

* Purpose of trusts
* Common elements of trusts
* Types of trusts
* Living trusts
* Income tax & trusts
* Gift tax & trusts
* Estate tax & trusts
* Identification, recital & property transfer clauses
* Income and principal & revocation and amendment clauses
* Trustee & trust termination clauses

1. Identify the relationship of parties in a trust, reasons to establish a trust, and types of trusts specifying their estate planning function.
2. Specify recommended living trust provisions, identify the application of gift and income tax including the use of a grantor trust and an unlimited marital deduction, and determine what constitutes an “A-B” and “A-B-C” trust format.

       At the start of Chapter 5, participants should identify the following topics for study:

* Individual ownership & sole proprietorships
* Corporations
* Trusts & co-tenancies
* Co-tenancy taxation, percentage interests & partition
* Partnership taxation & recapitalization
* Family partnerships
* Limited liability companies
* Retirement plans
* Custodianship
* Estate

1. Identify tax and legal title formats naming differences among these entity formats by:
a. Specifying the advantages and disadvantages of holding property individually and through a sole proprietorship or a corporation stating how to avoid associated title pitfalls;
b. Selecting primary groups of C corporations specifying the estate-planning problems associated with each; and
c. Recalling advantages that partnerships can have over corporations.
2. Determine S corporation rules stating tax advantages and disadvantages and also specify disadvantages and advantages of incorporating a farm.
3. Identify title holding benefits of trusts, co-tenancy, partnerships, and limited liability companies and the tax characteristics of each.
4. Specify types of retirement plans used to provide lifetime benefits to a business owner and to employees, identify how title can be held on behalf of minors and the tax treatment of custodianships, and recall the tax treatment of a probate estate.

       At the start of Chapter 6, participants should identify the following topics for study:

* Types of life insurance
* Life insurance trusts
* Deferred annuities
* Private annuities
* Buy-sell agreements
* Purchase price & terms
* Community property
* Professional corporations
* S corporations
* Sole shareholder planning

1. Specify persons in which rights are placed by life insurance and reasons to purchase life insurance.
2. Identify the tax treatment of life insurance proceeds by:
a. Determining the treatment of premiums for personally owned life insurance and related benefits and specifying exceptions to this treatment including the transfer for value rule;
b. Select variables that influence whether life insurance is taxable for federal estate tax purposes; and
c. Recalling the gift tax associated with the transfer of life insurance policies.
3. Specify the pros and cons of various types of life insurance policies to guide clients in choosing a suitable policy.
4. Identify reasons for establishing an irrevocable life insurance trust to achieve estate tax planning advantage, specify considerations in establishing life insurance trusts, and determine the differences between deferred and private annuities.
5. Determine what constitutes an entity purchase agreement and a cross-purchase agreement recognizing tax and legal advantages.

       At the start of Chapter 7, participants should identify the following topics for study:

* Business valuation of tangible & intangible assets & goodwill
* Business valuation of qualified family-owned businesses
* Business valuation of land subject to a conservation easement
* Business valuation discounts
* Redemptions
* Buy-sell agreements
* Death of spouse
* Stock redemptions
* Stock recapitalization
* Deferred compensation agreements

1. Identify reasons why a business interest must be valued in an estate that is subject to federal estate tax, specify factors used to determine the net value of a business under the regulations, and recall the valuation factors in R.R. 59-60 specifying their impact.
2. Determine how tangible assets are normally valued identifying those assets whose valuation is based on values other than book value, and specify the steps in R.R. 68-609’s valuation formula for intangible assets specifying the effect such amount can have on the total value of a business. 3. Identify special business valuation issues including redemptions under §303 by:
a. Recognizing the purpose and use of buy-sell agreements;
b. Recalling the terms of the election that allows clients to exclude from their taxable estate 40% of the value of land subject to a qualified conservation easement;
c. Determining the value of a minority stock interest and fractional interests in order to obtain applicable valuation discounts, and
d. Citing the §303 exception to the dividend treatment of redemptions stating qualifications.
4. Determine the tax consequences in leaving an estate to a surviving spouse, specify the elements of buy-sell agreements, stock redemptions, and stock recapitalizations in order to dispose of business interests before death, and identify deferred compensation agreements recognizing their estate planning impact.

       At the start of Chapter 8, participants should identify the following topics for study:

* Application of estate tax freeze rules
* Corporations, partnerships & exceptions
* Qualified payment exception to zero value rule
* Minimum valuation of a junior interest
* Capital contributions, redemptions & recapitalizations
* Attribution rules
* Transfers of interests in trust
* Term interests & joint purchases
* Buy-sell agreements & options
* Lapsing rights & restrictions

1. Determine the benefits of an estate freeze and its ability to reduce the value of a business interest, identify transactions to which Chapter 14 rules apply and terminology used in the Chapter 14 valuation rule that applies to corporations and partnerships, and specify exceptions to §2701.
2. Identify the “zero value” rule under §2701 by:
a. Recalling the qualified payment exception and the consequence of being excepted;
b. Specifying variables that impact the application of §2701 stating how to avoid taxable events when valuing a distribution right;
c. Determining the transfer tax when a taxpayer fails to make a qualified payment on time identifying the appropriate election into or out of qualified payment treatment; and d. Specifying a junior equity interest according to §2701 rules and determining the value of other rights held together with an extraordinary payment right.
3. Determine the application of §2701 provisions by:
a. Recalling the treatment of a capital contribution, a redemption, or a recapitalization under §2701;
b. Identifying when an individual is deemed the owner of an interest that is held indirectly through a corporation, partnership, trust, or other entity based on the §2701 attribution rules;
c. Specifying when transfer tax adjustments will be made to transfers or inclusions in the gross estate;
d. Identifying the split of an applicable retained interest allowing value to be given to a participating feature of a participating preferred interest; and
e. Specifying the stepped computation under the subtraction method to determine an amount of a gift resulting from a transfer to which §2701 applies.
4. Recall the terms used in §2702 concerning transfers of interests in trust, identify the application of the zero value rule to a transfer of interest in trust, specify exceptions to §2702, determine the transfer of an interest in property when there are one or more term interests as a transfer of an interest in a trust, and specify the treatment of joint purchases.
5. Recognize the requirements and exceptions of §2703 to ensure property is valued appropriately, identify lapses as a transfer by gift or as includible in the decedent’s gross estate under §2704, recall the key terminology of §2704 under the evaluation rules, specify the amount of the transfer stating which lapses or restrictions qualify as an applicable restriction.

       At the start of Chapter 9, participants should identify the following topics for study:

* Managing the estate
* Medicare
* Medicaid & countable assets
* Medicaid & non-countable assets
* Medicaid & inaccessible assets
* Private insurance
* Healthcare decisions
* Supplemental security income
* Income & assets
* Disability benefits

1. Recall estate management techniques for the elderly and disabled by:
a. Identifying joint tenancy and the benefits and drawbacks of using such a method for asset management;
b. Specifying levels of conservatorship that can influence management and protection of an estate and/or personal care and disadvantages of this tool; and
c. Determining what constitutes a durable power recognizing advantages of establishing a revocable living trust as a way to manage assets in an estate.
2. Cite the eldercare benefits of Medicare, Medicaid, and Supplemental Security Income, identify disadvantages of the Medicaid program stating how to divide income into asset groups, and specify the dangers and benefits of gifting to family members, including how individuals might use private insurance for catastrophic illness.
3. Identify tools that can allow patients to refuse treatment even when incompetent, determine Supplemental Security Income specifying how it relates to elderly and disability planning, and specify the requirements that must be met in order to receive disability benefits.

       At the start of Chapter 10, participants should identify the following topics for study:

* After death planning
* Federal returns
* Decedent’s estate tax
* Preparation of Form 706
* Estate income tax return
* Filing requirements of decedent’s final income tax return
* Included income
* Exemptions & deductions
* Filing the gift tax return
* Special applications & traps of the gift tax return

1. Determine post-mortem estate planning action in the face of funeral and administrative expenses using elections and disclaimers.
2. Cite the due dates of post-mortem federal forms, specify the filing requirements of a decedent’s estate tax return, and identify exceptions to the general rule of estate tax payment.
3. Determine the processes and procedures necessary in the preparation and filing of Form 706.
4. Identify the filing requirements for estate income tax and decedent’s final income tax returns by:
a. Determining the estate income tax under available tax accounting methods and tax years; and
b. Specify the use of Form 1310 for a decedent or a joint return for a decedent and his or her surviving spouse.
5. Determine total income to be included on the decedent’s final income tax return using available exemptions or deductions.
6. Identify how to avoid penalties when filing a gift tax return, recognize gift splitting to reduce gift taxes, and recall special gift applications and traps stating ways to avoid their tax consequences.

Chapter 1 - Estate Planning

Build, Preserve & Distribute

Legal Documents

Estate Planning Team

Attorney

Accountant

Insurance Agents

Financial Planner

Estate Administration

Probate Court

Executor

Internal Revenue Service (IRS)

Trustee

Family Members

Things to Be Done When Death Occurs

Estate Planning Techniques & Devices

Transfers within Probate

Disposition of Property without a Will

Disposition of Property with a Will

Transfers Outside Probate

Joint Tenancy with Right of Survivorship

Tenancy in Common

Retirement Plan & Individual Retirement Accounts

Life Insurance

Gifts

Payable on Death Accounts (POD)

Transfers Using a Trust

Special Planning Tools

Spending

Annual Gift Tax Exclusion

Applicable Exclusion Amount

Spousal Portability of Unused Exemption Amount

Unlimited Marital Deduction

Installment Payment of Estate Taxes - §6166

Private Annuities

Regs Restrict Private Annuity Tax Benefits

Installment Sale to Family Member

Self-Canceling Installment Notes

Irrevocable Life Insurance Trust

Special Valuation of Farms and Businesses - §2032A

Crummey Trusts

Charitable Remainder Trusts

Minor Trusts

Family Limited Partnerships

Grantor Retained Income Trusts

Qualified Personal Residence Trusts (QPRTs)

Grantor Retained Annuity Trusts (GRATs)

Grantor Retained Unitrusts (GRUTs)

Buy-Sell Agreements

Estate Planning Facts

Family

Property

Domicile

Objectives

Existing Estate Plan

Chapter 2 - Estate & Gift Taxes

Federal Estate Tax

Persons Subject to Federal Estate Tax

Applicable Exemption (or Exclusion) Amount

Spousal Portability of Unused Exemption Amount - §2010(c)(2)

Estate Tax Rates

Progressive or Flat Rate

State Inheritance Tax

State Death Tax Credit Turns into Deduction – §2011 & §2058

Taxable Estate - §2051

Gross Estate - §2031

Owned Property - §2033

Interests Terminating At Death - Life Estates & Joint Tenancies

Interests Created After Death

Remainder Interests

Dower & Curtsey - §2034

Community Property Comparison

Gifts within Three Years of Death - §2035

Transfers from Revocable Trusts

Retained Life Interest - §2036

Retained Voting Rights

Lifetime Transfers With Reversionary Interests - §2037

Revocable Transfers - §2038

Annuities - §2039

Joint Interests - §2040

Qualified Joint Interests Between Spouses - §2040(b)

Powers of Appointment - §2041

Ascertainable Standard - The Safe Harbor Limitation

5/5 Power

Life Insurance - §2042

Incidents of Ownership

Community Property Issue

Deductions from Gross Estate

Estate Expenses & Claims - §2053

Inclusion of Administrative Expenses on Non-Probate Assets

Casualty & Theft Losses during Administration - §2054

Charitable Transfers - §2055 (§170 & §2522)

Immediate Contributions

Split-Interest Contributions

Charitable Remainder Trusts

Charitable Lead Trusts

Insurance Related Contributions

Unlimited Marital Deduction - §2056

Requirements

Net Value Rule

Non-Citizen Spouse

Qualified Domestic Trust

Gifts to Non-Citizen Spouses

Valuation

IRS Valuation Explanation - §7517

Alternate Valuation - §2032

Special Valuation - §2032A

Estate Tax Return & Payment - §6018

Installment Payment of Federal Estate Taxes - §6166

Computation

Eligibility & Court Supervision

Closely Held Business

Acceleration of Payment

Stepped-up Tax Basis for Estate Assets - §1014

Community Property Cost Basis

GST Tax - §2601

Predeceased Parent Exception

Exemption

Allocation

Retroactive Allocation

Gift Taxes - §2501 to §2524

Gift Tax Computation

Calculation Steps

Applicable Exemption Amount for Gift Tax - §2505

Application

Entity Rule

Valuation

Real Property

Stocks & Bonds

Annuities, Life Estates, Terms for Years, Remainders, & Reversions

Split Gifts - §2513

Community Property States

Annual Exclusion

Per Donee/Per Year

Gifts in Excess of the Annual Exclusion

Gifts Within the Annual Exclusion

Gifts within 3 Years of Death

Uniform Gifts to Minors Act

Exception for Minor’s Trusts - §2503(b) & (c)

Medical & Tuition Exclusion - §2503(e)

Qualifying Transfers

Interest-Free or Below-Market Loans

Gift Tax Marital Deduction

Nondeductible Terminable Interests

Gift Tax Charitable Deduction

Partial Interests

Selecting Gift Property

Gift Advantages

Gift Disadvantages

Gift Tax Returns

Inclusion of Gifts in the Estate

Shifting Income & Gain

Gifts before Sale

Transfers into Trust Prior to Sale

Installment Obligations

Transfer to Obligor at Death

Income in Respect of a Decedent

Reporting of Foreign Gifts - §6039(f)

Chapter 3 - Wills & Probate

What Is A Will?

Provisions & Requirements

Specific & General Bequests

Residual Bequests

Conditional Bequests

Executor

Guardian

Types of Wills

Title Implications

Individual

Joint Tenancy

Tenants in Common

Tenants by the Entirety

Community Property

Tax Basis Advantage

Untitled Assets

Changes to a Will

Advantages of a Will

Intestate Succession

Periodic Review

Continuing Business Operations

Simple Will

Probate

Advantages

Disadvantages

Probate Avoidance

Joint Tenancy

Community Property

Totten Trust Accounts

Life Insurance & Employee Benefits

Living Trusts

Chapter 4 - Trusts

What is a Trust?

Why a Trust?

Types of Trusts

Common Elements

Revocable Trust

Irrevocable Trusts

Testamentary Trust

Foreign Trusts - §679

Family Trusts

Medicaid Trust

Living Trust

Reversion

Advantages of a Living Trust

Disadvantages

Priority

Pour-Over Will

Trust Taxation

Income Tax

Grantor Trusts - §671 to §678

Grantor Retained Income Trust

Revocable Trusts Included in Estate - §646 & §2652(b)(1)

Election for Income Tax Purposes

Irrevocable Trust Taxation

Throwback Rules

Capital Gains

Deduction of Estate Planning Expenses

Deductibility of Death Expenses

Gift Tax

Estate Tax

Unlimited Marital Deduction

Outright to Spouse

Marital Deduction Trust

Qualified Terminable Interest Property (QTIP) Trust

“A-B” Format

“A-B-C” (QTIP) Format

Valuation & Tax Basis

Alternate Valuation

Fundamental Provisions - Revocable Living Trust

Identification Clause

Recital Clause

Property Transfer Clause

Income & Principal Clause

Revocation & Amendment Clause

Trustee Clause

Trustee’s Acceptance

Choice of a Trustee

Factors for Corporate Trustees

Factors for Individual Trustees

Trust Termination Clause

Chapter 5 - Entities & Title

Basic Entity Formats

Individual & Sole Proprietorship

Marital Property

Timing & Domicile

Corporate

Categories of C Corporations

Personal Holding Company - §541

Attribution Rules

Penalty Tax

Regular C Corporation

Corporate Tax Rate

No Pass-Through

Getting Money Out of the C Corporation

Passive Loss Restrictions

Partnership vs. Corporation

Personal Service Corporation - §269A

S Corporation - §1361

Minors as Shareholders

Bequests & Estate Ownership

Trusts as Shareholders

S Corporation Assets

Built-In Gains - §1374

Incorporation of a Farm

Land Partnership Advantage

Leasebacks

Trusts

Title Holding

Business Trusts

Co-Tenancy

Taxation

Percentage Interests

Partition

Partnership

Partnership Taxation

Allocation of Income & Deduction

Partnership Recapitalization

Two Class Format

Valuation

Guaranteed Payment

Control & Management

Estate Issues

Family Partnerships

Estate Savings

Income Tax Savings

Family Partnership Requirements

Recognizing a Partner

Control

Transferability

Donee as a Partner

Trusts as Partners

Minor as a Partner

Purchased Interests

Capital Interest in the Partnership

Capital as a Material Income-Producing Item

Source of Capital

Family Partnerships Not Within §704(e)

Real Estate Family Partnerships

Business Family Partnerships

Structuring the Family Partnership

Limited Liability Company

Outside Basis & Debt Share Advantage

Substantial Economic Effect Rules

Discharge of Indebtedness Income

Suggested Uses

Professional Firms

Joint Ventures

Substitute for Family Limited Partnership

Retirement Plan

Employer Costs

Profit-Sharing Plan

Money Purchase Pension Plan

Defined Benefit Pension Plan

Custodianship

Estate

Chapter 6 - Life Insurance, Annuities & Buy-Sell Agreements

Purpose

Tax Overview

Income Tax

Transfer for Value Rule

Employee Death Benefit - §101(b) (Repealed)

Premiums

Lifetime Benefits

Section 72

Estate Taxes - §2042 & §2035(a)

Ownership

Gift Taxes

Community Property Gift Danger

Types of Life Insurance

Term Insurance

Whole Life (Permanent) Insurance

Straight Life v. Limited Payment

Modified v. Preferred

Endowment Insurance

Universal Life

Charges

Premium Payment

Variable life

Investment Accounts

Taxation

Survivor Life

Single Premium Whole Life

Dividends

Life Insurance Trust

Considerations

Annuities

Deferred Annuity

Private Annuity

Unsecured Promise

Regulations Restrict Private Annuity Income

Buy-Sell Agreements

Definition

Contractual Format

Funding

Life Insurance Funding

Term vs. Whole Life

Policy Ownership & Premium Payment

Entity & Cross-Purchase Agreements

Tax Consequences - Cross-Purchase Agreements

Non-Deductible Premiums

No Dividend Danger

Tax Consequences - Entity Purchase Agreements

Non-Deductible Premiums

Dividend Danger - §302

Exception to Dividend Treatment

Constructive Ownership (Attribution) Rules

“Estate/Beneficiary” Rule

“Family/Trust/Corporation” Rule

No Gain on Sale

Estate Tax Valuation

Using the Buy-Sell Agreement to Set Value

Enforcement of Contract Price

Purchase Price & Terms

Valuation

Community Property

Professional Corporations

Marketability Problems

Controlled Disposition

S Corporations

Sole Shareholder Planning

Complete Liquidations

Alternative Dispositions

Use of Life Insurance

Estate Valuation

One-Way Buy-Outs

Chapter 7 - Special Business Issues

Business Valuation

Relevant Facts

Revenue Ruling 59-60

Tangible Assets

Special Real Estate Election - §2032A

Limitations

Related Party Cash Lease

Intangible Assets & Goodwill

R.R. 68-609

Land Subject To Conservation Easement - §2032A(c)(8)

Family Member

Indirect Ownership of Land

Qualified Conservation Easement

Qualified Real Property Interest

Qualified Organization

Conservation Purpose

No Additional Income Tax Deduction

Valuation Discounts

Minority Interests

Special Valuation Plus Minority Discount

Fractional Interests

Lack of Marketability

Swing Vote Premium

Buy-Sell Agreements

Redemptions Under §303

Requirements

Corporate Accumulation For §303 Redemption

Accumulation in Anticipation of Shareholder’s Death

Death of a Spouse

Bypass Trust

Lifetime Dispositions

Stock Redemptions Under §302

Substantially Disproportionate Redemption - 80/50 Rule

Redemptions Not Essentially Equivalent to a Dividend

Complete Redemptions

Constructive Ownership - §318

Double Attribution

Stock Attribution in Complete Redemptions

Stock Recapitalization

Section 306 Taint

Deferred Compensation Agreements

Installment Payment of Federal Estate Taxes - §6166

Computation

Eligibility & Court Supervision

Closely Held Business

Acceleration of Payment

Chapter 8 - Estate Freeze Rules

Application

Corporations & Partnerships - §2701

Definitions

Member of the Family

Applicable Family Member

Applicable Retained Interest

Control

Exceptions To §2701

Zero Value Rule

Qualified Payment Exception to Zero Value Rule

Valuation of Qualified Payments - Lowest Value Rule

Cumulative but Unpaid Distributions - Compounding Rules

Taxable Events

Amount of Increase

Limitation

Applicable Percentage

Transfer Tax Adjustment

Election into Qualified Payment Treatment

Election Out of Qualified Payment Treatment

Minimum Valuation of a Junior Interest

Definitions

Junior Equity Interest

Equity Interest

Value of Other Rights

Capital Contributions, Redemptions, & Recapitalizations

Attribution Rules

Corporation

Partnership

Estate & Trust

Siblings & Lineal Descendants

Transfer Tax Adjustments

Splitting Retained Interests

Subtraction Method

Three-Step Computation

Valuation Adjustment

Transfers of Interests in Trust - §2702

Definitions

Applicable Family Member

Member of the Family

Transfer in Trust

Term Interest

Retained

Zero Value Rule

Qualified Interest

Exceptions to §2702

Incomplete Gift

Term Interests

Successive v. Concurrent

Leasehold

Joint Purchases

Term Interests in Tangible Property

Transfers of Interest in Portion of Trust

Buy-Sell Agreements & Options - §2703

Exceptions to §2703

Arm’s Length Bargain

Substantial Modifications

Exceptions

Lapsing Rights & Restrictions - §2704

Definitions

Member of the Family

Lapse

Voting Right

Liquidation Right

Control

Amount of Transfer

Restrictions on Liquidations Disregarded

Attribution Rules

Chapter 9 - Elderly & Disabled Planning

Managing the Estate

Joint Tenancy

Conservatorship

Durable Power

Revocable Living Trust

Catastrophic illness

Medicare

Medicaid

Countable Assets

Non-Countable Assets

Personal Residence

Gifting the Residence - General Rule

Exceptions

Inaccessible Assets

Gifts

Spousal Transfers

Spousal Allowance

Medicaid Trusts

Limited Trust Exceptions

Criminalization of Medicaid Asset Transfers

Private Insurance

Health Care Decisions

Supplemental Security Income

Income

Unearned Income

Earned Income

Exempt Income

Assets

Countable Assets

Non-Countable Assets

Disability Benefits

Blind

Kidney Disease

AIDS

Chapter 10 - Post-Mortem Planning & Tax Return Requirements

After Death Planning

Alternate Valuation Election

Special Use Valuation

Election to Defer Payment

Final Medical Expenses

Administration Expenses

QTIP Election

Disclaimers

Federal Returns

Form 1040 - Decedent’s Income Tax

Form 1041 - Estate’s Income Tax

Form 706 - Decedent’s Estate Tax

Decedent’s Estate Tax - Form 706

Filing Requirements

Paying the Estate Tax

Section 6161

Section 6166

Section 6163

Overview of Form 706

Definitions

Preparing Form 706

Form 706, Part 1, Page 1 - Decedent & Executor

Form 706, Part 3, Page 2 - Elections by the Executor

Form 706, Part 4, Pages 2 & 3 - General Information

Schedule A, Page 5 - Real Estate

Schedule A-1, Pages 6 through 9 - Section 2032A Valuation

Schedule B, Page 10 - Stocks and Bonds

Schedule C, Page 11 - Mortgages, Notes, and Cash

Schedule D, Page 12 - Insurance on Decedent’s Life

Schedule E, Page 13 - Jointly Owned Property

Schedule F, Page 14  - Other Miscellaneous Property

Schedule G, Page 15 - Transfers During Decedent’s Life

Schedule H, Page 15 - Powers of Appointment

Schedule I, Page 16 - Annuities

Schedule J, Page 17 - Funeral and Administration Expenses

Schedule K, Page 18 - Debts of Decedent, and Mortgages and Liens

Schedule L, Page 19 - Net Losses During Administration and Expenses Incurred in Administering Property Not Subject to Claims

Schedule M, Page 20 - Bequests to Surviving Spouse

Schedule O, Page 21 - Charitable Gifts and Bequests

Schedule P, Page 22 - Credit for Foreign Death Taxes

Schedule Q, Page 22 - Credit for Tax on Prior Transfers

Schedules R & R-1, Pages 23 thru 27 - Generation-Skipping Transfer Tax

Old Schedule T Gone - Qualified Family-Owned Business Interest

Schedule U, Page 28 - Qualified Conservation Easement Exclusion

Form 706, Part 5, Page 3 - Recapitulation

Form 706, Part 6, Page 4 - Portability of Deceased Spousal Unused Exclusion (DSUE)

Form 706, Part 2, Page 1 - Tax Computation

Schedule PC, Pages 29 - 31 - Protective Claim for Refund

Discharge from Personal Liability

Estate Income Tax Return - Form 1041

Filing Requirements

Schedule K-1

Tax Computation

Exemption Deduction

Contributions

Statute of Limitations

Accounting Methods

Taxable Year

Double, Split & Solo Deductions

Decedent’s Final Income Tax Return - Form 1040

Preceding Year Return

Filing Requirements

Refund

Form 1310

Joint Return with Surviving Spouse

Request for Prompt Assessment

Included Income

Partnership Income

S Corporation Income

Self-Employment Income

Community Income

Interest & Dividend Income

Exemptions & Deductions

Medical Expenses

Election for Decedent’s Expenses

Making the Election

AGI Limit

Medical Expenses Not Paid By Estate

Insurance Reimbursements

Deduction for Losses

At-Risk Loss Limits

Passive Activity Rules

Gift Tax Return - Form 709

Penalties

Filing

Extension of Time to File

Extension of Time to Pay

Split Gifts

Special Applications & Traps

Bargain Sales

Below Market Loans

Exception

Net Gifts

Promises to Make a Gift

Checks

Stock Certificates

Promissory Notes

Powers of Appointment

Appendix A - Sample Revocable Living “A-B” Trust Agreement

A. RIGHT TO ADD PROPERTY TO TRUST

B. RIGHT TO AMEND OR REVOKE TRUST

C. RIGHT TO DIRECT TRUSTEE RE INVESTMENTS, ETC

A. DURING THE JOINT LIFETIMES OF BOTH TRUSTORS.

B. UPON THE DEATH OF EITHER TRUSTOR SURVIVED BY THE OTHER.

C. SIMULTANEOUS DEATH OF BOTH TRUSTORS

D. TERMINATION OF TRUST

E. CONTEST OF TRUST

A. GENERAL POWERS

B. NO PHYSICAL DIVISION REQUIRED

C. PAYMENTS TO MINORS OR INCOMPETENTS

D. ADDITION OF ASSETS TO TRUST

E. RETENTION OF ASSETS

F. TRANSACTIONS WITH ESTATE OF TRUSTOR

G. LOANS TO TRUST ESTATE

H. ENUMERATION OF POWERS NOT LIMITATION

I. PURCHASE OF TREASURY BONDS

J. POWERS CONSISTENT WITH MARITAL DEDUCTION

Appendix B - Family Limited Partnership Agreement

Appendix C - Buy & Sell Agreement

Appendix D - Care Documents

GUIDELINES AND DIRECTIVE

GUIDELINES FOR SIGNERS

SUMMARY AND GUIDELINES FOR PHYSICIANS

INTRODUCTION

SIGNATURE AND WITNESSES

EFFECT OF A DIRECTIVE

REVOCATION

OTHER RIGHTS

PRECAUTIONS

SUMMARY

Recording Requested By:

When Recorded Return To:

RECORDING REQUESTED BY

AND WHEN RECORDED MAIL TO

WARNING TO PERSON EXECUTING THIS DOCUMENT*

STATEMENT OF WITNESSES

REQUIREMENTS

RECORDING REQUESTED BY

AND WHEN RECORDED MAIL TO

Glossary