Steve Oshins Releases 10th Annual Non-Grantor Trust State Income Tax Chart

By Steven J. Oshins, Esq., AEP (Distinguished) Different states have different rules as to what creates a “resident trust” that is subject to taxation in that state. States may tax a trust based on the residency of the settlor or testator, based on whether there is a resident trustee or beneficiary or whether there is administration in that state, or for a combination of these factors and/or other similar factors. So it isn’t as easy as simply situsing a trust in a state with no state income tax. You have to look at the state taxing statutes that may apply….

Heckerling 2024 Reports from the ABA

The 2024 Heckerling Institute was held in-person (and virtually) in Orlando on January 8-12 and marked the conference’s 58th year. The Phillip E. Heckerling Institute on Estate Planning is the nation’s premier conference for estate planning professionals, offering unparalleled educational and professional development opportunities for all members of the estate planning team.  Over the course of the conference’s five days, numerous timely topics of interest to estate planners of all designations—including, but not limited to, attorneys, trust officers, accountants, charitable giving professionals, elder law specialists, wealth management professionals, and nonprofit advisors. As they have done for many years, the American…

How to Work Around California’s Anti-ING Trust Legislation

By Steven J. Oshins, Esq., AEP (Distinguished) It finally happened.  California passed SB 131 in its 2023 legislative session which, among other things, sadly contains a provision treating all so-called Incomplete Non-Grantor Trusts (“ING Trusts”) as grantor trusts taxed to the settlor. This takes away a key tool planners have used for many years to reduce California state income tax on taxable income not sourced to California. The legislation is effective retroactive to January 1, 2023, so many California residents were wrongly punished for following the law that existed prior to the date this legislation passed.  It remains to be…

SECURE 2.0 Act Enhances Special Needs—See Through Trust Planning

By Edwin P. Morrow, III, J.D., LL.M., MBA, CFP®, CM&AA® and Nancy H. Welber, J.D., ACTEC Thanks to the generosity of Leimberg Information Services, we are pleased to provide you this recently published article on LISI. EXECUTIVE SUMMARY Section 337 of the Secure 2.0 Act, effective in 2023, provides a welcome, though very limited in scope, enhancement to special needs trusts designed to receive retirement benefits and qualify as see through trusts under the Secure Act provision for applicable multi-beneficiary trusts (AMBTs). The new provision provides that most charities can now be remainder beneficiaries after the death of a disabled…

Why Do Nevada and Delaware Get Most of the ING Trust Business?

By Steven J. Oshins, Esq., AEP (Distinguished) We keep hearing about NING Trusts (Nevada) and DING Trusts (Delaware).  Occasionally, but much less often, we hear about WING Trusts (Wyoming) too. Nevada and Delaware clearly get the vast majority of the ING Trust business.  Wyoming seems to be the next jurisdiction to take a reasonably good chunk of the pie. Is this because these jurisdictions actually have the best laws?  Or is it simply a function of good marketing?  The words “NING”, “DING” and “WING” just roll off the tip of your tongue, eh? Let’s take a close look at ING…

Poll Results: Which Is the Best Trust Jurisdiction?

By Steven J. Oshins, Esq., AEP (Distinguished) In a one-week LinkedIn poll conducted in March of 2023, I asked thousands of people primarily made up of estate planners and financial planners: “Which is the best trust jurisdiction?” Among 5,104 “impressions” (number of times users see the poll question), there were 123 total votes. The permitted responses were limited to Nevada and South Dakota simply because these are so clearly the two best trust jurisdictions and therefore there was no reason to dilute the votes by including additional options. Results The results were as follows: *Nevada           …

9th Annual Non-Grantor Trust State Income Tax Chart Released!

By Steven J. Oshins, Esq., AEP (Distinguished) Different states have different rules as to what creates a “resident trust” that is subject to taxation in that state. States may tax a trust based on the residency of the settlor or testator, based on whether there is a resident trustee or beneficiary or whether there is administration in that state, or for a combination of these factors and/or other similar factors. So it isn’t as easy as simply situsing a trust in a state with no state income tax. You have to look at the state taxing statutes that may apply….

Update on Washington State 7% Capital Gains Tax

By Steven J. Oshins, Esq., AEP (Distinguished) One of the most anticipated tax cases in some time has begun its way through the courts. On January 26, 2023, the Washington Supreme Court heard arguments in Chris Quinn v. State of Washington which is a case examining the constitutionality of the Washington State 7% capital gains tax. The Washington capital gains tax was passed by the Democrats and signed into law in 2021.  There’s a $250,000 exemption for individuals and married couples, so only the capital gains in excess of $250,000 are subject to the tax. Capital gains taxes would not…

Projecting the Year-by-Year Estate and Gift Tax Exemption Amount

By Steven J. Oshins, Esq., AEP (Distinguished) The federal estate and gift tax exemption is currently $12,060,000 per person. This number increases (or decreases) each year based on inflation and then is rounded. This article does nothing extraordinary. It simply lays out the projected increases over the next few years based on the most recent inflation rate which is 8.5%. Anybody with a calculator can compute these numbers, but many people have not yet done so, so the numbers outlined herein may come as a shock! Trump Tax Act The Trump Tax Act increases (or decreases) the federal estate and…

Did You Know That Nevada Has Laws Allowing for Larger Valuation Discounts Than in Every Other State?

By Steven J. Oshins, Esq., AEP (Distinguished) Estate planners have been rushing to help clients make large gifts before the gift and estate tax exemption drops in half at the end of 2025. But are estate planners truly maximizing the wealth transfer for their clients? Most are not doing so, simply because they’re failing to take advantage of a legislation I authored that passed and became law in Nevada’s 2009 legislative session. This was likely overlooked because the gift and estate tax exemptions exponentially increased soon after that thereby making it unnecessary for the smaller net worth clients to fully…