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Recent Posts
An Overview of Asset Transfer Strategies

You may need to transfer assets for all sorts of reasons. A working knowledge of ...

The post An Overview of Asset Transfer Strategies first appeared on Integrated Tax Planning, Legal Planning & Financial Planning.

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Tax Planning with Charitable Trusts (Lead vs. Remainder Trusts): A Guide

When navigating the complex world of estate planning, financial planning, and tax planning, understanding the ...

The post Tax Planning with Charitable Trusts (Lead vs. Remainder Trusts): A Guide first appeared on Integrated Tax Planning, Legal Planning & Financial Planning.

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Irrevocable Trusts and Crummey Powers

January 6, 2021

If you created an irrevocable trust in 2020, you need to ensure that certain kinds of gifts that are made to the trustee to pay premiums are kept up to date. One aspect of an irrevocable trust that this influences are known as Crummey powers or annual demand powers.

This allows gifts to qualify for the gift tax annual exclusion and this means a written notice for any 2020 gifts or gifts in future years will then need to be issued. This can be very complicated if you have transfers made to multiple trusts in addition to outright gifts made directly to heirs.

You will then have to prioritize those gifts based on the terms of the trust and the dates to determine whether or not those gifts do indeed qualify for the annual exclusion. This can get even more complicated if you use other estate planning strategies, such as a generation skipping transfer tax.

This may require you to file a gift tax return to allocate the exemption for the GST and to ensure that the trust stays exempt from GST. As you can see, these strategies can be powerful and helpful for your estate plan but only when they are appropriately drafted, organized and followed through. For more support with advanced estate planning strategies, schedule a consultation with a trusted estate planning lawyer.


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Recent Posts
An Overview of Asset Transfer Strategies

You may need to transfer assets for all sorts of reasons. A working knowledge of ...

The post An Overview of Asset Transfer Strategies first appeared on Integrated Tax Planning, Legal Planning & Financial Planning.

See more
Tax Planning with Charitable Trusts (Lead vs. Remainder Trusts): A Guide

When navigating the complex world of estate planning, financial planning, and tax planning, understanding the ...

The post Tax Planning with Charitable Trusts (Lead vs. Remainder Trusts): A Guide first appeared on Integrated Tax Planning, Legal Planning & Financial Planning.

See more