Description
Post-divorce administration of grantor trusts can present fiduciaries with significant challenges. While the IRC generally treats distribution of assets in a marital dissolution as a non-taxable event, the presence of a grantor trust can bring unanticipated income and gift tax consequences when assets are transferred to the non-grantor former spouse. The new tax reform law also has implications for grantor trusts.
Section 2516 exempts certain payments and transfers between former spouses that would otherwise be taxable, but only when those payments are made pursuant to a written agreement to resolve divorcing spouses’ joint property rights or provide for child support. Transfers outside the scope of joint property rights or support of minor children are deemed taxable.
Estate and fiduciary advisers must also navigate the impact of “kick-out” provisions in estate and trust documents. While these provisions serve to protect the grantor’s interest, they can create situations in which distributions from the trust outside the scope of Section 2516 to the former spouse are treated as taxable transfers. Estate planners and fiduciary advisers must ensure these rules work to avoid adverse tax consequences.
Listen as our panel of estate planning counsel details the specific challenges of administering grantor trust transfers to former spouses arising from divorce, since tax reform.
Presented By
Mr. Goldstein focuses his practice on trust and estate planning for individuals and sophisticated tax planning for businesses. He is knowledgeable regarding the latest strategies in federal and state tax planning, including the most advantageous exemptions for business owners with complex business structures. As both an attorney and CPA, he provides the full range of estate and tax planning solutions to his clients, including income, estate, gift and generation-skipping transfer tax planning, wills and trusts, taxpayer representation in income, estate and gift tax audits, planning for owners of closely-held businesses with diverse interests, including real estate and a variety of other non-cash assets, operating and shareholder agreements, buy/sell arrangements and succession planning, multi-generational wealth planning, including creditor protection and charitable planning.
Ms. Young focuses her practice in the area of trusts and estates law and taxation. She counsels individuals, families and family offices on estate planning matters and business succession planning, including income tax planning and retirement, marital and charitable planning. She works with RSM tax professionals nationally on trust administration issues and estate and trust planning for individuals, families and family offices. She resolves gift and estate tax return examinations at the state and federal level. She presents nationally at conferences on topical estate, trust and gift tax issues. Her planning expertise is concentrated on the income tax aspects of estate planning, including fiduciary income tax minimization strategies (state and federal), charitable planning, marital planning, retirement planning and opportunities presented by decanting.
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This 90-minute webinar is eligible in most states for 1.5 CLE credits.
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BARBRI is a NASBA CPE sponsor and this 90-minute webinar is accredited for 1.5 CPE credits.
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BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).
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Date + Time
- event
Wednesday, February 14, 2018
- schedule
1:00 PM E.T.
- Section 2516 provisions exempting transfers between former spouses
- Grantor trust rules of Section 682
- Kick-out provisions and impact on taxability of transfers between former spouses
- Section 671
- Drafting and administrative strategies to minimize income and gift tax impact of trust transfers after tax reform
The panel will review these and other key issues:
- Transfers between former spouses incident to divorce that fall outside the tax exempt provisions of Section 2516
- Grantor trust rules as they apply in divorce scenarios
- How “kick-out” provisions in estate and trust documents impact grantor trust status
- Strategies to minimize income and gift tax consequences from trust distributions to former spouse after tax reform
- Tax reporting requirements
Learning Objectives
After completing this course, you will be able to:
- Identify transfers from grantor trusts to former spouses incident to divorce that can create income or gift tax consequences
- Recognize the impact of “kick-out” provisions on transfers to a former non-grantor spouse
- Determine strategies for minimizing the taxability of divorce-related trust transfers
- Field of Study: Taxes
- Level of Knowledge: Intermediate
- Advance Preparation: None
- Teaching Method: Seminar/Lecture
- Delivery Method: Group-Internet (via computer)
- Attendance Monitoring Method: Attendance is monitored electronically via a participant's PIN and through a series of attendance verification prompts displayed throughout the program
- Prerequisite: Three years+ business or public firm experience at mid-level within the organization, drafting wills and trust documents, supervising other estate planners/accountants. Specific knowledge and understanding of gift tax rules and trust transfer provisions; familiarity with valuation provisions and allocation rules governing trust transfers.
BARBRI is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of Accountancy have final authority on the acceptance of individual courses for CPE Credits. Complaints regarding registered sponsons may be submitted to NASBA through its website: www.nasbaregistry.org.
BARBRI is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).
BARBRI CE webinars-powered by Strafford-are backed by our 100% unconditional money-back guarantee: If you are not satisfied with any of our products, simply let us know and get a full refund. Contact us at 1-800-926-7926 .
