The 7520 rate for August is holding steady at 2.2%.
The August 2014 Applicable Federal Interest Rates can be found here.
While constant attention is being given to Hillary Clinton’s potential decision to run for the presidency in 2016 and the release of her latest book, Hard Choices, last month, news sources recently reported that she and former President Bill Clinton have taken advantage of several of the estate planning techniques recommended by trusts and estates attorneys for high net worth individuals.
This is interesting, in part, because the Clintons support the estate tax and have not been in support of its repeal.
According to reported sources, each of the Clintons created a qualified personal residence trust and each contributed his or her 50% ownership interest in their Chappaqua, New York house to his or her respective trust. A qualified personal residence trust, commonly called by its acronym QPRT, is an IRS sanctioned estate planning technique. The creator of the trust places a residence or interest in a residence in the trust, retains the right to live in the trust for a term of years, and after the term the trust asset or the residence passes to a beneficiary.
The Internal Revenue Code has special rules which help calculate the value of the “gift” made by the creator to the QPRT. The gift portion, which could offset some of the $5,340,000 exemption allotted to individuals in 2014 is not the entire value of the residence, but the value of the residence when transferred reduced by the value of the retained use by the creator for the trust term.
By having each of the Clintons create a separate QPRT with only a 50% interest in the residence, the value of such interest may also be eligible for a discount for owning less than a majority interest.
In order for a QPRT to work, the creator of the trust must outlive the trust term. But for a relatively healthy individual, it is quite likely for this to happen.
POLST, or Physician Orders for Life-Sustaining Treatment, is an approach to end-of-life care that encourages discussions between patients and their health care providers. The goal of POLST is to enable patients to choose the treatment they want or do not want, and to ensure that those preferences are honored. (more…)
Frequently, taxpayers are surprised by the fact that the ownership or receipt of a life insurance policy can result in taxable income, as was the case in Gluckman v. Commissioner.
Apparently, this life lesson was not learned, or if learned, was forgotten, by Roy Greenbaum, the Personal Representative in Estate of Tanenblatt v. Comm’r. The issue in this case concerned the valuation of a 16.667% interest in an LLC included in the Diane Tanenblatt’s gross estate. (more…)
The firm announced recently that Jarriot Rook has joined us in our St. Louis office as an associate.
Rook received his J.D., cum laude, and his LL.M. in tax from Washington University in 2010. He also earned his B.A. in psychology from Washington University.