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Evaluating Trust Documents for Tax Consequences: Trust Types, Distribution and Termination Clauses, Beneficiary Powers

Note: CLE credit is not offered on this program

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Wednesday, March 27, 2024

Recorded event now available

or call 1-800-926-7926

This course will explain common provisions found in trust documents that have meaningful tax consequences. Our panel of trust veterans will identify clauses found in trust documents that affect distributions, termination, and taxation of trusts and trust beneficiaries.

Description

The income tax treatment of different types of trusts varies significantly. Most notable is the taxation of grantor and non-grantor trusts, where the former taxes the individual who created the trust. The latter may tax the trust itself, its beneficiaries, or a combination of the two, depending on the type of trust and whether it is a simple or complex trust. The type of trust--revocable or irrevocable--influences the basis of assets held and whether beneficiaries may or may not receive a date of death step-up.

Common trust clauses impact distributions and grant powers to beneficiaries that ultimately control the trust and its beneficiaries' taxation. These include 5X5 withdrawal rights, HEMs, and spendthrift provisions. Tax professionals working with trusts need to identify and interpret common trust language that affects the taxation of the trust and its beneficiaries and the preparation of Form 1041.

Listen as our panel of trust taxation experts examines common provisions found in trust instruments for fiduciaries, tax practitioners, and trust advisers.

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Outline

  1. Types of trusts
  2. Basis considerations
  3. Beneficiaries and powers
  4. Distributions and taxation
  5. Finalizing the trust
  6. Other income tax considerations

Benefits

The panel will review these and other critical issues:

  • Determining tax differences between revocable and irrevocable trusts
  • How the type of trust influences date of death step-up
  • Identifying support and discretionary distribution clauses in the trust document
  • Deciding when a trust is terminated based on the language in the trust document

Faculty

Bridgers, Griffin
Griffin H. Bridgers
Member
Hutchins & Associates

Mr. Bridgers' practice encompasses all areas of private wealth and family business. In addition to estate...  |  Read More

Doyle, Jere
Jeremiah W. (Jere) Doyle, IV
Senior Vice President
Bank of New York Mellon

Mr. Doyle provides clients with integrated wealth management advice on how to hold, manage and transfer their...  |  Read More

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