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Have Your Cake And Eat It Too: Tax Deferment and Lower Tax Preparation Costs By Making A 645 Election


What is a 645 Election:
The Internal Revenue Code §645 allows an irrevocable election to treat a qualified revocable trust (QRT) as part of the decedent’s estate for federal income tax purposes. The election allows tax advantages available to an estate to be available to the trust.

A qualified revocable trust (QRT) is a grantor trust under Sec. 676 (with revocation power retained by the grantor) as of the decedent’s date of death. Typical Revocable or Living Trusts are QRTs because the grantor retained the right to revoke the trust.

When the decedent has both a QRT and probate estate, the Sec. 645 election allows the trustee and the executor to combine a QRT and an estate into one tax return, filed as an estate. Even if there is not a separate probate estate, this election can be used to file the trust return (or several separate QRTS) as though the trust were an estate. Continue Reading →

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The IRS Wants You To Have Angry Beneficiaries


Imagine you’re the personal representative (executor) of your uncle’s estate. In his will, he’s left $10,000 to a dear friend in Italy. Your attorney calls and says, “We need to get in touch with Sophia in Rome to let her know she needs to ‘register’ with the IRS.”

Your first reaction might be “Sophia is a bit of a hothead – she’s not going to like this one bit.” Your second reaction might be, “This sounds like something that could hold things up.” You could easily be right on both counts. Continue Reading →

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Know the Risks When Becoming or Choosing a Trustee

A calculator, pen, and financial statement.

Serving as trustee of a trust is a big responsibility. Often we don’t think much about what it truly means to be a fiduciary for someone else. We simply nominate our children, sister, brother, family friend, etc. After all, we are helping out family and friends.

Being a trustee seems pretty simple, make some distributions, keep a record of what comes out of the trust account, send some statements….easy. WARNING, what may seem simple or easy, often isn’t.

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BATTLE OF THE DOCUMENTS: Multiple Health Care Surrogate Designations

You know you should update your estate planning documents every so often to keep them current. You know you should update them when you have a major life change, like the birth of a child, the death of a spouse or a divorce.

Simple Health Care Surrogate forms can be found everywhere, online, Assisted Living Facilities, Hospitals… But what happens to your old designations when you sign a new form? Does the current document revoke the first? What happens if there are more than one valid Health Care Surrogate Designation? Continue Reading →

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Estate Planning in the Cloud

A variety of digital document archival sites have been gaining popularity online lately.  They offer to help you estate clouddigitally store all your important legal and estate planning documents right alongside generations of family photos and secret family recipes, all right there in the cloud.  I don’t know about you, but I’m still a little hesitant to rely solely on cloud storage, especially for important documents like my living trust and health care directives.  What if the site hosting the cloud goes out of business?  What if their site is hacked and all my personal information is compromised?  What if their technology fails?  Then what?? Continue Reading →

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Oakstone Law
1415 Panther Lane, Suite 439
Naples, Florida 34109
Tel: 239.206.3454