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Special Needs Trusts: What You Need to Know

Last modified: March 13, 2024

Key Takeaways

Special Needs Trusts offer:

  • Financial Security: Provide financial support without affecting government benefits.
  • Flexibility: Include first-party and third-party options for diverse needs.
  • Medicaid Compliance: Avoid disqualification from government assistance.

Check out our Special Needs Trust service.

Planning for the care of a loved one with special needs or a disability can have its challenges. For example, how can you ensure they are cared for and have everything they need? How can you provide them with assets and avoid jeopardizing their government benefits? 

You can help answer these questions and avoid some of these challenges by setting up a Special Needs Trust.

Continue reading Special Needs Trusts: What You Need to Know →

Posted in Trusts 1 Comment

Charitable Lead Trusts: Types and Taxation

Last modified: March 13, 2024

Key Takeaways

Charitable Lead Trusts enable:

  • Philanthropic Goals: Support charities while reducing tax liabilities.
  • Flexible Structures: Offer various types for different planning needs.
  • Tax Efficiency: Provide potential tax advantages for donors and their heirs.

Check out our Charitable Trust services.

Charitably inclined high-net-worth individuals often want to provide for their philanthropic goals while reducing their tax liability. While there are many different ways to do this, there are some lesser-used options that can create unique opportunities for charitable giving. 

An often underutilized but valuable tool in estate planning is the Charitable Lead Trust.

Continue reading Charitable Lead Trusts: Types and Taxation →

Posted in Charitable Trusts 1 Comment

What is a Charitable Remainder Trust and How Are They Taxed?

Last modified: March 13, 2024

Key Takeaways

Charitable Remainder Trusts provide:

  • Income and Tax Benefits: Offers an income source while enabling significant tax deductions.
  • Asset Management: Facilitates the transfer of assets to a trust for charity and personal gain.
  • Philanthropic Goals: Supports charitable causes after fulfilling the income period.

Check out our Charitable Trust services.

A significant benefit of Charitable Remainder Trusts is that they allow the opportunity for donors to know they will be giving financial support to a favored charity in the future. Charitable Remainder Trusts are commonly used for the purpose of planned giving within a thoughtful and holistic financial plan.

Alliance administers many different kinds of Charitable Remainder Trusts. Learn more about how they are taxed differently than other types of trusts in this article.

Continue reading What is a Charitable Remainder Trust and How Are They Taxed? →

Posted in Charitable Remainder Trusts, Charitable Trusts, Estate Planning, Trusts 1 Comment

Estate Planning Tax Changes: What To Expect Under New Administration

Last modified: March 13, 2024

Key Takeaways

Estate planning tax changes anticipate:

  • Exemption Reductions: Potential lowering of gift and estate tax exemptions.
  • Capital Gains Adjustments: Possible changes to capital gains tax strategies.
  • Proactive Planning: The importance of early estate planning in response to tax law changes.

Check out our estate planning services.

Changes to Both Gift and Estate and Capital Gains Taxes expected under Biden’s administration

President Joe Biden presented reform strategies during his presidential campaign, creating a prudent need for high-net-worth families to review their estate plans early in 2021. While campaigning, President Biden proposed several tax changes, two of them significant estate planning tax changes.

The first is a premature reduction of the gift and estate tax exemption from the Tax Cuts and Jobs Act of 2017. The second is ending the step-up in tax basis for capital gains taxes on inherited property. Let’s take a look at both.

Continue reading Estate Planning Tax Changes: What To Expect Under New Administration →

Posted in Estate Planning, Taxes, Trusts 2 Comments

Part 2: Asset Protection and Nevada Asset Protection Trusts, Frequently Asked Questions

Last modified: March 13, 2024

Key Takeaways

Nevada Asset Protection Trusts offer:

  • Enhanced Security: Strong protections against creditors.
  • Short Statute Limitations: Only two years for challenges to asset transfers.
  • Beneficiary Flexibility: Allows settlors to also be beneficiaries.

Check out our Asset Protection Trust services.

Examining Nevada Asset Protection Trusts: Common Questions Our Trust Officers Receive

In Part 2, we examine typical questions regarding Nevada Asset Protection Trusts. Nevada Asset Protection is sought after globally, and among the primary reasons estate planners look to Nevada as their preferred trust jurisdiction.

In part 1, we answered six general questions we often receive about Asset Protection Trusts in general.

Continue reading Part 2: Asset Protection and Nevada Asset Protection Trusts, Frequently Asked Questions →

Posted in assest protection, assest protection trusts, Nevada, Nevada Trusts

Part 1: Asset Protection and Nevada Asset Protection Trusts, Frequently Asked Questions

Last modified: March 13, 2024

Key Takeaways

Nevada Asset Protection Trusts offer:

  • Robust Protection: Safeguard assets from creditors effectively.
  • Flexibility in Estate Planning: Tailor to individual financial situations.
  • Irrevocable Trust Advantages: Provides strong legal asset protection.

Check out our Asset Protection Trust services.

Six Common Questions Regarding Asset Protection Trusts

Part 1 focuses on general Asset Protection Trust questions we often receive from families and advisors. Part 2 focuses on Nevada Asset Protection Trusts.

Continue reading Part 1: Asset Protection and Nevada Asset Protection Trusts, Frequently Asked Questions →

Posted in assest protection, assest protection trusts, Nevada, Nevada Trusts

Foreign Grantor Trust: The Basics

Last modified: July 11, 2024

Key Takeaways

Foreign Grantor Trusts offer:

  • Tax Efficiency: Ideal for international tax planning.
  • Flexibility: Both revocable and irrevocable options available.
  • Strategic Benefits: Maximizes advantages under U.S. and Nevada laws.

Check out our Trustee Services.

Care for Your Off-Shore Beneficiaries

Foreign families with loved ones in the U.S. may wish to set up a foreign grantor trust.

The foreign grantor trust allows international families to take advantage of tax benefits, increased flexibility, political stability, and secure asset protection laws.

What is a Foreign Grantor Trust?

A foreign grantor trust is both a foreign trust and a grantor trust. The trust is not subject to U.S. income tax on income produced by non-U.S. situs assets. 

A revocable foreign grantor trust established in the U.S. remains revocable until the death of the grantor at which time it becomes irrevocable. The irrevocable trust benefits the U.S. beneficiary, but any U.S. situs assets are then subject to U.S. tax. 

If the settlor has the power to revoke the trust, it is considered a revocable trust for U.S. tax purposes.

If the grantor is both the settlor and owns the assets in trust, it is also considered a grantor trust and is not subject to U.S. tax on non-U.S. sourced income.

Continue reading Foreign Grantor Trust: The Basics →

Posted in Foreign Grantor Trust, Uncategorized 1 Comment

Three Significant U.S. Trust Tax Cases, One Issue: Nexus Between a State and a Trust

Last modified: March 13, 2024

Key Takeaways

Trust taxation insights:

  • Nexus Requirement: States must have a significant and existing nexus with a trust to tax it constitutionally, challenging historical practices.
  • Migrating Trusts: Strategies for trust migration can influence state tax implications, emphasizing the importance of jurisdiction selection.
  • Role Residencies: The residency of trustees and beneficiaries significantly impacts a trust’s taxability, underlining the value of expert estate planning.

Check out our Estate Planning services.

When are states permitted to tax undistributed trust income?

As I am researching another precedent-setting trust case for an upcoming virtual continuing education panelist discussion for IICLE (Illinois Institute for Continuing Education), it’s hard to ignore the trend we see regarding trust taxation.

In 2018, we closely followed the Fielding case’s trajectory with our business development director and company president. We watched as Fielding won in Minnesota’s Supreme Court and as the case landed on the steps of the Supreme Court of the United States.

Also, on the SCOTUS steps at the time was the Kaestner case out of North Carolina. As many of us are very aware, SCOTUS denied hearing Fielding but argued Kaestner, and the rest is history.

Continue reading Three Significant U.S. Trust Tax Cases, One Issue: Nexus Between a State and a Trust →

Posted in Taxes, Trusts

Nevada Dynasty Trusts: Asset Protection for Generations

Last modified: November 10, 2023

4 Reasons to Consider Establishing Your Dynasty Trust in Nevada

Choosing the right trust strategy to protect your assets is an important and often complex decision. Dynasty trusts are a great option when you need to secure assets for generations, and they minimize or even eliminate many taxes associated with trusts including distribution, estate, inheritance, transfer taxes, and more.

Once you’ve decided that a dynasty trust is right for you, the next most important decision is where you should establish your trust.

Both Nevada and Delaware are considered some of the best places to establish a trust to take full advantage of friendly trust laws, because of precedents set in both Nevada and Delaware, Nevada is often considered the better choice.

If you’re feeling unsure about establishing a Nevada Dynasty Trust, here are four reasons why it’s the best choice to pass your legacy to your family for several generations.

Continue reading Nevada Dynasty Trusts: Asset Protection for Generations →

Posted in Dynasty Trusts, Trusts
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