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Intentionally Defective Grantor Trusts
An Intentionally Defective Grantor Trust (IDGT) is commonly used as an effective tool for estate tax planning. An IDGT is disregarded for income tax purposes, but it is a legally valid irrevocable trust for estate tax purposes. Appreciating assets are usually transferred to an IDGT out of the grantor’s taxable estate. Once the assets are transferred and owned by…
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IRA One-Rollover-Per-Year Limitation
The IRS clarified its rules regarding non trustee-to-trustee IRA transfers recently, based on the Bobrow U.S. Tax Court decision. Beginning as early as January 1, 2015 (the IRS has yet to decide on an implementation date), individuals are limited to one non-taxable IRA-to-IRA rollover every 12 months. A non-taxable IRA-to-IRA rollover is a transaction where…