By Robert S. Keebler, CPA, MST, AEP (Distinguished), CGMA In the world of finance, “Alpha” is often referred to as the value a money manager generates by exceeding a particular benchmark. In the world of financial planning, Tax Alpha® is best defined as the value financial advisors add by reducing the tax burden on portfolio income – “After all, it is what you keep not what you earn that counts.” A thorough knowledge of the intersection between tax and finance will allow an advisor to substantially reduce a client’s overall tax burden. The heart of Tax Alpha® for most clients…
Recent IRA Developments
By Robert S. Keebler, CPA, MST, AEP (Distinguished), CGMA | Volume 2, Issue 6 (June 2014) Individual Retirement Arrangements (IRAs) are one of the most popular retirement saving vehicles available today. Many of your clients, if not all, will have either (if not both) a Traditional IRA or a Roth IRA. The rules concerning IRAs are vast and continually being further defined. In this article, I will discuss some of the more important IRA developments over the past six months or so. Bobrow v. Commissioner In Bobrow v. Commissioner, TC Memo 2014-21, the court interpreted the “limit of one IRA to IRA…
Recent IRA Developments
By Robert S. Keebler, CPA, MST, AEP (Distinguished), CGMA | Volume 2, Issue 6 (June 2014) Individual Retirement Arrangements (IRAs) are one of the most popular retirement saving vehicles available today. Many of your clients, if not all, will have either (if not both) a Traditional IRA or a Roth IRA. The rules concerning IRAs are vast and continually being further defined. In this article, I will discuss some of the more important IRA developments over the past six months or so. Bobrow v. Commissioner In Bobrow v. Commissioner, TC Memo 2014-21, the court interpreted the “limit of one IRA to IRA…
Frank Aragona Trust: What Now Constitutes Trustee “Material Participation”?
By Robert S. Keebler, CPA, MST, AEP (Distinguished), CGMA | Volume 2, Issue 5 (May 2014) [1] In Frank Aragona Trust v. Commissioner, the U.S. Tax Court held that a trust can qualify for the IRC Section 469(c)(7) real estate professional exception.[2] Furthermore, the court held that the trust materially participated in real property businesses it owned. Don’t get excited quite yet, though. Although the holding that a trust can be a real estate professional is very favorable, the case does little to resolve the issue of whose participation can be counted for purposes of determining whether a trust materially participates in an…
Understanding Portability
By Robert S. Keebler, CPA, MST, AEP (Distinguished) | Volume 2, Issue 3 (March 2014) An interesting provision within the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (“2010 Tax Relief Act”) allows an executor of an estate of a married decedent the option to transfer any unused estate tax exemption amount to the surviving spouse.[1] Thus, for example, if a decedent used only a portion of his or her estate tax exemption, the estate could elect to have the remaining portion pass to the surviving spouse, giving the surviving spouse a larger estate tax exemption.[2] Although this portability…
Robert Keebler’s Net Investment Income Tax Bundle Package
Many professionals have expressed a desire for further assistance with the 3.8% Net Investment Income Tax (“NIIT”) and completion of new IRS Form 8960. In recent weeks, we have enlisted the help of nationally renowned CPA and tax expert, Robert S. Keebler, CPA, MST, AEP (Distinguished) to present on several topics on NIIT. You can spend hours deciphering Internal Revenue Code Section 1411, the final regs and the instructions for Form 8960. But, as tax professionals, we know that your time is limited and you may not have time to wait to get the help that you need right away…
Form 8960—The Net Investment Income Tax
By Robert S. Keebler, CPA, MST, AEP (Distinguished) | Volume 2, Issue 2 (February 2014) In 2013, a new tax planning focus area, the net investment income tax (NIIT), was added to the already long list of hot topics all trust and estate practitioners must understand– charitable trusts, gain harvesting, loss harvesting, income smoothing strategies, income shifting strategies, asset protection trusts, tax-aware investing, decanting, portability, advanced strategies for clients with taxable estates, etc. While the NIIT is far from clear in some areas, parts of this new tax planning focus area have recently been clarified through the release of the…
BREAKING NEWS: IRS Issued Rev. Proc. 2014-18, Granting Relief for Some Late Portability Elections
The IRS issued Rev. Proc. 2014-18 today, announcing that it would grant blanket relief for the estates of persons who died in 2011, 2012, and 2013, if the estate was not required to file a return. The IRS announced that it will allow these estates to file a return to elect portability until December 31, 2014. Any estates of persons dying after 2013 that don’t file a timely return to elect portability can apply for a private letter ruling. For more information, click here to listen to LISI’s 60-Second Planner with nationally renowned CPA, Robert S. Keebler. Also, see Rev….
Final IRS Form 8960 Released Today
The IRS published the final Form 8960, for computing the 3.8% Net Investment Income Tax for individuals, trusts and estates. To download final Form 8960, click here. Also, don’t forget to register for our special 90-minute teleconference with nationally renowned CPA, Robert Keebler on Thursday, February 6th at 9am Pacific Time (12pm Eastern Time) for a detailed walk-through of Form 8960. For more information and to register, click here.
Robert Keebler’s 2014 Tax Planning Success Kit
More and more, you’re seeing clients (and prospects) turning their attention away from traditional estate tax and financial planning and toward income tax reduction and asset protection. Why? Because of ATRA’s higher ordinary and income tax rates, higher capital gains tax rates, deduction phase-outs and higher estate tax exemption, Obamacare’s “net investment income “surtax”, a higher estate tax exemption, and an increasingly lawsuit-happy society! Fortunately, it’s not difficult to re-tool your practice to meet this new demand for income tax and asset protection planning. You just need to “tweak” how you use many of the techniques already in your bag…