Jonathan Blattmachr and Martin Shenkman discuss Sales to non grantor trusts. These experts on the subject talk about its history, concepts and objectives.
- Power of annual gifts
- Failure to comply with terms
- Tax consequences
- Spouses ownership
- Asset protection benefits
- Community Property Laws
- Dividing Assets
Nevada is one of the few states, that has a statute that allows the creation of a self-settled spendthrift trust to protect one’s assets from creditors. As a practitioner in this state, I may be biased in saying that Nevada law is superior in the creditor protection arena but many will agree that this bias is not baseless.
In October of 1999, the Nevada State Legislature revised the “Spendthrift Trust Act of Nevada” allowing a person to create a spendthrift trust for the protection of his own assets – hence the term self-settled spendthrift trust. If created and managed correctly, a person can create a trust to which he transfers his personal assets and avail of creditor protection, even when the person is also a beneficiary of the trust. Nevada law also does not prohibit the person from serving as a trustee of the trust but it is very important that the power to make distributions to the person is at the discretion of someone else. This is where the use of professional trustees is highly beneficial.
A trust is a “grantor trust” for income purposes to the extent that under the rules articulated in subpart E (section 671 through 679) of part 1 of subchapter J and chapter 1 of the Internal Revenue Code of 1986, as amended, the trust’s income, deductions, and credits against tax are attributed to its grantor or its beneficiary. A trust may be a grantor trust in its entirety or only in part, and may be a grantor trust with respect to one or more taxpayers.
Trusts: Planning and Drafting for Divorce.
- In an equitable distribution jurisdiction, the court may fashion a remedy it deems appropriate for the circumstances of the parties.
- Even if you say all the assets of a trust are separate property the court might order an award of all martial property to the other spouse to offset the impact of the separate property trust.
- Planning now in light of Van Hollen’s STEP proposal, the Sanders’ proposal, various income tax proposals, and President Biden’s comments.
- Inter-relationship of income tax changes, Sanders and Van Hollen is key.
- Republicans have come back with a reply to the infrastructure bill suggesting instead of raising taxes having user fees.
- We will discuss each of these, the constitutionality, and end with a discussion of practical planning implications.
- President Biden is to address a joint session of Congress shortly and we may get a better window into what might happen.