Trust, inheritance taxes

[Unregistered]

I will have to send client else where on this one. Farmer says all assets were put into a trust to avoid inheritance taxes but now wants to relook at it due to increase in death tax credit. Can anyone tell me what type of trust this may have been and where I can find more information.
Thanks
Sam

[S T]

Seems Like

Seems like you would need a copy of the Trust Agreement and then a copy of all the transfer of assets "titles" to determine what was placed into the Trust. Also a copy of the will.

Client might need to see a Probate Attorney.

Sandy

[Unregistered]

Revocable vs not

If it was a revocable trust, he can revoke. If it was Irrevocable he has a problem and trust and gift tax returns probably should have been done whe formed. Get the agreement.

[Bees Knees]

Farmer says all assets were put into a trust to avoid inheritance taxes but now wants to relook at it due to increase in death tax credit.

If it was a revocable trust, he can revoke. If it was Irrevocable he has a problem and trust and gift tax returns probably should have been done whe formed.

Funny how people think they can have it both ways.

If it is a revocable trust, meaning the farmer can go back and undo what he just did, then it won’t avoid inheritance tax…not even on the appreciation.

If it is an irrevocable trust, meaning the farmer can’t go back and undo what he just did, then it will only avoid inheritance tax on the appreciation after being placed in the trust.

The farmer isn’t going to like either answer. I don’t think people would do so many stupid things if they would just talk to the accountants first before going to that attorney.

[Unregistered]

Funny how people think they can have it both ways.

If it is an irrevocable trust, meaning the farmer can’t go back and undo what he just did, then it will only avoid inheritance tax on the appreciation after being placed in the trust.

Bees Knees, I don't follow you on the irrevocable trust part. How is the basis determined when it is put into the trust? How about when assets are distributed to the heirs?
Sam

[Bees Knees]

The basis of an asset put into an irrevocable trust is the basis in the hands of the one putting it in the trust, increased by the amount of any gift tax paid on the transfer.

[Unregistered]

Bees revocable comment

do not get it. Revocable trust NEVER helps with estate taxes. Does help with administering the estate after death.

[Bees Knees]

Bees revocable comment do not get it. Revocable trust NEVER helps with estate taxes. Does help with administering the estate after death.

That's what I said. I said "a revocable trust...won’t avoid inheritance tax…not even on the appreciation."

What's not to get?