Tax Reporting Mechanics of Trust Decanting: Tackling Compliance Issues Absent IRS Guidance

Continuation-vs.-New Trust, Gain Recognition Scenarios, Elections, and Filing Requirements

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

Conducted on Tuesday, October 22, 2019

Recorded event now available

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Program Materials

This webinar will provide tax advisers and compliance professionals with a comprehensive and practical guide to the reporting mechanics of trust decanting transactions. The panel will discuss when decanting results in a non-reporting event and offer useful tools for determining when decanting causes either gain recognition or a transfer tax reporting and payment obligation.


Trust decanting--the distribution of trust property from one trust to another trust--is a popular and frequently utilized vehicle for keeping estate plans current and tax-efficient. Despite the growing prevalence of decanting as a strategy, however, the IRS has not provided authoritative guidance on proper tax reporting treatment of decanting transactions. Indications are that a definitive statement may not be forthcoming any time soon.

In addition to notification requirements, tax advisers and compliance professionals must deal with several critical issues in reporting decanting transactions. Determining whether the second trust should be treated as an entirely new trust, or simply as a continuation of the first trust, has significant reporting consequences.

Another critical issue is the treatment when the decanting may generate gain recognition, such as in circumstances of distributions of negative-basis assets or creation of new powers of appointment in the second, beneficiary trust. Advisers must be sure to address the new vs. continuation question in reporting decanting transactions.

Listen as our experienced panel provides a thorough and practical guide to the tax reporting challenges and opportunities of decanted trusts.



  1. IRS guidance on decanting transactions
  2. Notice requirements
  3. Continuation of existing trust vs. the creation of a new trust
  4. Gain recognition scenarios
  5. Changing of situs
  6. Filing requirements


The panel will review these and other essential questions:

  • Under what circumstances is it preferable to treat the recipient trust as an entirely new trust rather than as a continuation of the existing trust?
  • What is the impact of a decanting on tax attributes?
  • What decanting circumstances require gain recognition to either the distributing trust or the beneficiary/recipient trust?
  • What elections are available regarding gain recognition of decanted assets?


Kirk, Bryan
Bryan D. Kirk

Director of Financial and Estate Planning
Fiduciary Trust International of California

Mr. Kirk provides guidance on all aspects of estate planning and trust and estate administration. He has broad...  |  Read More

Rever-Ginsburg, Dustin
Dustin Rever-Ginsburg


Mr. Rever-Ginsburg concentrates his practice on all aspects of estate planning, wealth transfer planning, charitable...  |  Read More

Anna Soliman
Anna Soliman
Trust Counsel
Fiduciary Trust International of California

Ms. Soliman most recently practiced in the tax and wealth department at Venable LLP in Los Angeles. She is experienced...  |  Read More

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