Post-Mortem Trust Planning, Modifications, and Allocations: Tax Elections Available to the Executor

Post-mortem tax and distribution planning often presents significant challenges for fiduciaries and estate planning counsel. This is particularly true of complex estates with assets located or trusts sitused in multiple states. In addition to complying with state and local law and tax reporting requirements, administrators frequently are faced with distribution decisions, evaluating tax elections and trust modifications in reaction to post-mortem events and changes in circumstances.

Planners and administrators may achieve significant income tax savings by evaluating trust structures and utilizing advanced strategies to gain step-ups in asset basis. Additionally, fiduciaries should be on the lookout for tax deferral opportunities, such as utilizing the provisions of IRC 6166 and other planning options.

With changes to the estate tax regime over the past decade shifting the emphasis from estate tax avoidance to income tax minimization, estate planners and administrators must have a thorough understanding of the post-mortem strategies available to avoid income tax while still honoring the decedent's testamentary intent.

Listen as our experienced panel provides a thorough and practical guide to advanced post-mortem planning strategies, risks, and opportunities.

1. Trust conversions and beneficiary designations
2. Post-mortem tax deferral elections
3. Six-month alternate valuation election
4. Tax deferral elections
5. Trust modification opportunities and risks

The panel will review these and other key topics:

• Turning a bypass trust into a grantor-type trust with the beneficiary as grantor
• Discounting the value of assets after death of the first spouse to die without adverse consequences
• Deferring tax using Section 6166, testamentary CLATs, and "Graegin loans"
• Getting a full step-up on basis at both the first and the second death
• Unfunded trusts
• Income tax planning for partnerships after death

Learning Objectives

After completing this course, you will be able to:

• Discern the impact of post-mortem elections available to estate planners and fiduciaries
• Recognize circumstances where a six-month alternate valuation would be appropriate
• Identify opportunities for discounting value of assets held by a marital trust after the death of the first spouse
• Decide when modification of trust documents such as turning a bypass trust into a grantor trust with a named beneficiary as the grantor would result in income tax savings
• Determine benefits of tax deferral elections such as IRC 6166, testamentary CLATs or Graegin loans

• 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, structuring estate plans, drafting wills and trust documents and supervising other planners/accountants. Specific knowledge and understanding of wills and trust provisions; familiarity with the Uniform Probate Code, Conflict-of-Laws issues in a probate setting, and available elections to minimize income tax consequence of estate income.

Strafford Publications, Inc. 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.

IRS Approved Provider

Strafford is an IRS-approved continuing education provider offering certified courses for Enrolled Agents (EA) and Tax Return Preparers (RTRP).