Florida Homestead Planning

By Julia Thomas | March 28, 2011

There are many benefits under Florida law applicable to a Florida resident’s primary residence, also known as the resident’s “homestead.” This includes protection from general creditors, ad valorem tax benefits (i.e., homestead exemption and “Save Our Homes” protection) and rights of a surviving spouse (assuming he or she has not validly waived such rights in…

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Baccei v. U.S.: Taxpayer Cannot Avoid Late Payment Penalty

By Julia Thomas | March 15, 2011

In Baccei v. U.S. (9th Cir. Feb 16, 2011), the estate’s accountant failed to properly complete Form 4768 requesting an extension of time to pay estate tax and the IRS assessed a late payment penalty. The estate paid the penalty and sued for a refund. The estate lost in District Court and appealed to the…

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Cancellation of Life Insurance Policy Results in Taxable Income

By Julia Thomas | March 14, 2011

In Sanders v. U.S., T.C. Memo 2010-279, petitioner purchased a whole life policy in 1979 and paid premiums until March 2006. The policy allowed petitioner to borrow up to the policy’s cash value, using the policy as security. Interest accrued on the loans at 8%. By its terms, the policy terminated if any unpaid loan,…

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IRS Responds to ABA Comments to Draft Form 8939

By Julia Thomas | March 11, 2011

On January 31, 2011, the Real Property, Trust & Estate Law Section of the ABA submitted comments to the IRS on the draft Form 8939 released by the IRS on December 16, 2011. Robert Chapman of the IRS Forms Desk responded a week later. Here are a few highlights from the IRS response. 1. Due…

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Linton v. U.S.: Indirect Gift of Property Owned by LLC

By Julia Thomas | March 8, 2011

In a victory for the taxpayer, the Ninth Circuit Court of Appeals reversed the lower court’s grant of summary judgment in favor of the IRS. The Lintons met with their attorney on January 22, 2003 to form, and transfer property to, a limited liability company (LLC). The Lintons also executed trust agreements for their children…

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This Week’s Reading

By Julia Thomas | March 4, 2011

Family Businesses Catch a Big Break By Anne Tergesen The Wall Street Journal, Family Value, February 19, 2011 Business Succession Planning and the New Gift Tax Exemption By Gerry W. Beyer Wills, Trusts & Estates Prof Blog, February 27, 2011 2010 Transfer Tax Changes – Actual Reform or Repairing a Leaky Dike with a Band-Aid…

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