Mastering Fiduciary Accounting Income for Estate Planners and Administrators

Recording of a 90-minute CLE/CPE webinar with Q&A


Conducted on Thursday, June 1, 2017

Recorded event now available

or call 1-800-926-7926
Program Materials

This CLE/CPE webinar will provide estate planners with a comprehensive and practical guide to navigating the complexities of fiduciary accounting income (FAI) for trusts and estates. The panel will focus on the impact of FAI on planners and estate administrators, and will detail how to interpret key trust and estate provisions to apply to FAI calculations. The program will focus on planning implications of FAI considerations, including distribution strategies and specific allocation challenges under trust accounting principles.

Description

A critical and often overlooked task for estate planners, administrators and trustees is navigating the rules governing FAI. FAI is the amount generally available to distribute to income beneficiaries of a trust or estate. It is different from both taxable income and distributable net income, both of which are tax-related concepts. It is crucial for estate planners and administrators to have a thorough understanding of FAI principles to properly allocate income and expenses and equitably distribute assets.

The starting point for determining FAI is the operating instrument, such as a will or trust agreement. Where the operating document is unclear as to an income receipt, an expense item or a distribution item, the FAI determination defaults to the state law where the situs of the trust is located. Most states have incorporated the UPIA, with some local differences. However, the timing and amount of distributions to beneficiaries is determined by fiduciary accounting principles.

Another key skill is reconciling FAI to both distributable net income and trust taxable income. In instances where trust documents do not adequately address distributable net income inclusion of capital gains, fiduciaries can be faced with significant tax challenges that can complicate distribution and allocation decisions. Accountants and lawyers representing fiduciaries need to be able to identify the critical differences between fiduciary accounting and tax accounting to avoid both tax consequences and beneficiary challenges.

Listen as our experienced panel provides a deep and practical guide to what estate planners must know to master FAI beyond the basics.

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Outline

  1. Specific challenges in allocating income and expenses to FAI
  2. UPIA factors in calculating FAI
  3. Impact of FAI on trust distributions
  4. Tax considerations such as distributable net income inclusion on distribution strategies
  5. Planning considerations and traps to avoid

Benefits

The panel will review these and other key issues:

  • How operating documents impact FAI calculations
  • Interpreting state laws and UPIA provisions in circumstances where operating documents are silent or inconclusive
  • Reconciling FAI to distributable net income and to trust taxable income
  • How FAI determines distribution amounts and timing

Faculty

Gregory V. Gadarian
Gregory V. Gadarian

Partner
Gadarian & Cacy

Mr. Gadarian's practice focuses on tax strategy, estate planning and asset protection law. Previously, he was a...  |  Read More

Scott M. Nelson, CPA
Scott M. Nelson, CPA

Hellmuth & Johnson

Mr. Nelson draws on more than 27 years of experience in trust and estates. He also has a background in business law and...  |  Read More

Other Formats
— Anytime, Anywhere

Strafford will process CLE credit for one person on each recording. All formats include program handouts. To find out which recorded format will provide the best CLE option, select your state:

CLE On-Demand Video

$297

Download

$297