A lawyer's guide to estate planning : fundamentals for the legal practitioner

cover image

Where to find it

Law Library — 2nd Floor Collection (2nd floor)

Call Number
KF750 .H85 2018
Status
Available

Summary

This book provides a helpful introduction to the basics of estate planning. It is written with an eye toward the needs of general practitioners and those who are seeking to develop a specialty in the estate-planning field. For this reason, the text is written in a user-friendly manner that provides basic text treatment of the subject along with cautions, examples, and planning pointers clearly denoted throughout the book. The cautions point out problem areas that must be considered to avoid an unwanted tax or other problem. The examples supplement the text and illustrate the point being discussed. The planning pointers show how to use the tax laws to benefit the tax and other planning needs of clients.

Contents

  • Preface p. xiii
  • About the Authors p. xv
  • Acknowledgments p. xvii
  • 1 Beginning the Process p. 1
  • 1.1 Initial Client Contact p. 1
  • 1.2 Initial Conference p. 2
  • 1.2.1 Client's Side of the Desk p. 2
  • 1.22 Lawyer's Side of the Desk p. 3
  • 1.3 Formulating the Estate Plan p. 5
  • Appendix A 
  • Family Questionnaire p. 6
  • Asset Questionnaire p. 11
  • Appendix B 
  • Engagement Letter for Individual p. 15
  • Engagement Letter for Couple p. 17
  • Additional Terms and Conditions of Client Employment p. 20
  • Privacy Notice p. 22
  • Appendix C 
  • Estate Tax Worksheet p. 23
  • Appendix D 
  • Dispositive Checklist p. 24
  • Appendix E 
  • Letter of Instructions p. 28
  • 2 Estate Tax Overview p. 29
  • 2.1 Introduction p. 29
  • 2.2 Gross Estate p. 30
  • 2.21 Gifts p. 30
  • 2.22 Transfers with Control Retained by Decedent p. 32
  • 2.23 Annuities and Retirement Benefits p. 33
  • 2.24 Joint Interests p. 35
  • 2.25 Powers of Appointment p. 36
  • 2.26 Life Insurance p. 37
  • 2.3 Adjusted Gross Estate p. 38
  • 2.4 Taxable Estate p. 39
  • 2.5 Net Estate Tax p. 40
  • 2.6 Filing and Payment p. 41
  • Appendix A
  • Unified Transfer Tax Rate Schedule p. 44
  • 3 Gift Tax Overview p. 45
  • 3.1 Background p. 46
  • 3.11 Gift Tax Overview p. 46
  • 3.12 Advantages of Gift Giving p. 46
  • 3.13 General Requirements p. 47
  • 3.14 Special Considerations p. 48
  • 3.14.1 Gifts of Services p. 48
  • 3.14.2 Disclaimers p. 49
  • 3.14.3 Assignment of Income p. 49
  • 3.14.4 Delivery of the Gift p. 49
  • 3.2 Annual Exclusion and Split Gifts p. 50
  • 3.21 Annual Exclusion p. 50
  • 3.22 Gift-Splitting p. 51
  • 3.3 Income Tax Basis in Gift Property p. 51
  • 3.4 Transfers Not Subject to Gift Tax p. 53
  • 3.41 Marital Deduction p. 53
  • 3.42 Charitable Deduction p. 54
  • 3.43 Tuition and Medical Expenses p. 54
  • 3.5 Gifts for the Benefit of Children p. 54
  • 3.6 Special Situations p. 56
  • 3.61 Net Gifts p. 56
  • 3.62 Gift Subject to an Indebtedness p. 58
  • Appendix A 
  • 2018 Individual Income Tax Rate Schedules p. 60
  • Appendix B 
  • 2018 Income Tax Rate Schedules for Use by Estate and Nongrantor Trusts p. 62
  • 4 Generation-Skipping Transfer Tax p. 63
  • 4.1 Background p. 63
  • 4.2 Overview p. 64
  • 4.21 Skip Person p. 64
  • 4.22 Transferor p. 64
  • 4.23 Taxable Distribution p. 65
  • 4.24 Taxable Termination p. 66
  • 4.25 Direct Skip p. 66
  • 4.3 Additional Cautions p. 67
  • 4.31 Pot Trusts p. 67
  • 4.32 Tax Apportionment Clauses p. 67
  • 4.33 Disclaimer p. 69
  • 4.34 Double Taxation p. 69
  • 4.35 Portability p. 69
  • 5 Trusts and Their Uses p. 73
  • 5.1 Background p. 73
  • 5.2 Types of Trusts p. 74
  • 5.21 A-B Trust p. 74
  • 5.22 QTIP Trust p. 76
  • 5.23 Premarital Trust p. 77
  • 5.24 Charitable Remainder Trusts p. 77
  • 5.25 Special Needs Trust p. 78
  • 5.26 Income-Only Trust p. 79
  • 5.27 Crummey Trust p. 80
  • 5.28 Disclaimer Trust p. 80
  • 5.29 Generation-Skipping Trust p. 81
  • 5.210 Living Trust p. 81
  • 5.211 Minor's or 2503(c) Trust p. 82
  • 5.212 Pot Trust p. 82
  • 5.213 Spendthrift Trust p. 83
  • 5.214 Standby Trust p. 84
  • 6 Powers of Appointment p. 85
  • 6.1 Background p. 85
  • 6.2 Estate and Gift Tax Provisions p. 87
  • 6.3 Effective Uses of Powers p. 88
  • 6.31 Limited Power of Appointment p. 88
  • 6.32 Power Limited to Ascertainable Standard p. 89
  • 6.33 5 or 5 Power p. 90
  • 6.4 Interpretation and Drafting Considerations p. 91
  • 6.41 Miscellaneous Forms p. 92
  • 7 Marital Deduction Planning p. 95
  • 7.1 Background p. 95
  • 7.2 Basic Requirements p. 96
  • 7.21 Survived by a Spouse p. 97
  • 7.22 Property Must Pass to Survivor p. 98
  • 7.23 Includable in Gross Estate p. 99
  • 7.24 Terminable Interest Rule p. 99
  • 7.24.1 General Requirements p. 99
  • 7.24.2 Exceptions p. 101
  • 7.3 Marital Deduction and Portability p. 102
  • 8 Life Insurance Planning p. 105
  • 8.1 Basic Types of Life Insurance p. 105
  • 8.11 Term Life Insurance p. 106
  • 8.12 Whole Life Insurance p. 106
  • 8.13 Universal Life Insurance p. 106
  • 8.14 Variable Life Insurance p. 107
  • 8.2 Taxation of Life Insurance Benefits p. 108
  • 8.21 Benefits Received During Lifetime p. 108
  • 8.22 Benefits Received Following Death p. 108
  • 8.3 Special Types of Life Insurance p. 110
  • 8.31 Split-Dollar Insurance p. 110
  • 8.32 Key-Man Insurance p. 110
  • 8.33 Group Life Insurance p. 111
  • 8.4 Life Insurance Trusts p. 111
  • 8.41 Revocable Life Insurance Trusts p. 111
  • 8.42 Irrevocable Life Insurance Trusts p. 113
  • Appendix A 
  • Uniform Premiums for $1,000 of Group Term Life Insurance Protection p. 117
  • 9 Charitable Giving p. 119
  • 9.1 Background p. 119
  • 9.2 Estate and Gift Tax Requirements p. 120
  • 9.3 Income Tax Requirements p. 120
  • 9.31 Cash and Ordinary Income Property p. 120
  • 9.32 Long-Term Capital Gain Property p. 121
  • 9.33 Tangible Personal Property p. 121
  • 9.34 Future-Interest Property p. 122
  • 9.35 Tax-Exempt Organizations p. 122
  • 9.4 Special Types of Charitable Gifts p. 123
  • 9.41 Remainder Interest in Farm or Personal Residence p. 123
  • 9.42 Qualified Conservation Contributions p. 123
  • 9.43 Gift Annuities p. 124
  • 9.44 Gift of Undivided Interest p. 125
  • 9.45 Pooled Income Fund p. 125
  • 9.5 Charitable Remainder Trusts p. 125
  • 9.6 Charitable Lead Trust p. 129
  • 9.7 IRA Distribution p. 130
  • 10 Business Buy-Sell Agreements p. 133
  • 10.1 Background p. 133
  • 10.2 Redemption and Cross-Purchase Agreements p. 134
  • 10.21 General Considerations p. 134
  • 10.22 Establishing the Sales Price p. 135
  • 10.3 Specific Considerations p. 136
  • 10.31 Insurance p. 136
  • 10.32 Income Tax Basis p. 139
  • 10.33 Dividend Problems with Redemption Agreements p. 140
  • 10.33.1 General Considerations p. 140
  • 10.33.2 Attribution Rules p. 140
  • 10.34 AMT Problems with Redemption Agreements p. 142
  • 10.35 Partnerships p. 142
  • 11 Retirement Plans and Benefits p. 145
  • 11.1 Background p. 146
  • 11.2 Types of Retirement Plans p. 146
  • 11.21 Pension Plans p. 146
  • 11.22 Profit-Sharing Plans p. 147
  • 11.23 Money-Purchase Plans p. 148
  • 11.24 401(k) Plans p. 148
  • 11.24.1 Simple 401(k) Plan p. 149
  • 11.25 Self-Employed Persons p. 149
  • 11.26 SEP p. 150
  • 11.27 IRA p. 150
  • 11.27.1 Roth IRA p. 151
  • 11.27.2 Simple IRA p. 151
  • 11.3 Participation, Vesting, and Nondiscrimination p. 152
  • 11.4 Top-Heavy Plans p. 153
  • 11.5 Social Security Integration p. 153
  • 11.6 Penalty Taxes p. 154
  • 11.6.1 Premature Distributions p. 154
  • 11.6.2 Minimum Distributions p. 154
  • 11.7 Distributions p. 155
  • 11.71 Distributions during Lifetime p. 155
  • 11.72 Distributions at Death p. 156
  • 12 Valuation of Assets p. 159
  • 12.1 Background p. 159
  • 12.2 Real Estate p. 160
  • 12.21 Cost Method p. 160
  • 12.22 Market Data Approach p. 160
  • 12.23 Income Approach p. 161
  • 12.24 Special-Use Valuation p. 161
  • 12.3 Tangible Personal Property p. 163
  • 12.4 Intangible Personal Property p. 163
  • 12.41 Valuation of Closely Held Stock p. 164
  • 12.41.1 Book-Value Approach p. 165
  • 12.41.2 Capitalization-of-Income Approach p. 166
  • 12.41.3 Discounts p. 167
  • 12.41.4 Buy-Sell Agreements p. 167
  • 13 Postmortem Estate Planning p. 169
  • 13.1 Background p. 169
  • 13.2 Qualified Disclaimers p. 170
  • 13.3 Will and Estate Litigation p. 171
  • 13.4 Considerations Affecting the Estate Taxes p. 172
  • 13.41 Alternate Valuation Date p. 172
  • 13.42 Section 303 Stock Redemption p. 173
  • 13.43 Special-Use Valuation p. 174
  • 13.44 Deferred Payment of Estate Taxes p. 175
  • 13.5 Considerations Affecting Income Taxes p. 177
  • 13.51 Medical Expenses p. 177
  • 13.52 Series E and EE U.S. Savings Bonds p. 177
  • 13.53 Selection of Estate's Tax Year p. 178
  • 13.54 Filing Joint Returns p. 178
  • 13.55 Administrative Expenses p. 179
  • 13.56 Termination of the Estate p. 179
  • 13.57 Waiver of Executor's Fee p. 180
  • 14 Choosing Executors and Trustees p. 183
  • 14.1 Choosing an Executor p. 183
  • 14.2 Choosing a Trustee p. 187
  • 14.3 Trustee Removal p. 188
  • 14.4 Individual Trustees p. 190
  • 14.4.1 Powers Over Principal p. 190
  • 14.4.2 Power to Discharge Trustee's Obligation of Support p. 191
  • 14.4.3 Power to Sprinkle Income p. 192
  • 14.4.4 Life Insurance on Trustee's Life p. 192
  • 15 Sample Forms p. 195
  • 15.1 Corporate Redemption Agreement p. 195
  • 15.2 Stockholder Cross-Purchase Agreement p. 199
  • 15.3 A-B Trust Planning Approach: Equalization of Estate between Husband and Wife p. 204
  • 15.4 Marital Deduction Planning with Disclaimer Trust p. 224
  • 15.5 Minor's or Educational Trust p. 228
  • 15.6 Irrevocable Life Insurance Trust p. 233
  • 15.7 Will, Trust, and Premarital Agreement p. 242
  • 15.8 Special Needs Trust for Handicapped Child p. 254
  • 15.9 Income-Only Trust p. 259
  • 15.10 Charitable Remainder Trusts p. 264
  • 15.11 Standby Trust p. 264
  • 15.12 Living Trust p. 269
  • Index p. 273

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