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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

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

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

COVID-19: Why Estate Planning is More Important Than Ever

Last modified: November 10, 2023

A brief overview of the two most common estate planning strategies

The current global health crisis has left many people uncertain about the future. Now more than ever, having a financial plan in place is crucial. Not only should you consider your immediate and short-term financial goals, but you should also look at long-term planning.

Specifically, what plans do you have in place to make sure your wishes are carried out and your family is taken care of after you are gone?

We review the basics of Estate Planning and what to consider in light of COVID-19.

Continue reading COVID-19: Why Estate Planning is More Important Than Ever →

Posted in Estate Planning, Living Trusts, Trusts

Deciding Between a Will and a Trust? The Distinctions You Need to Know

Last modified: September 6, 2023

The Basics of Wills and Trusts and What You Need to Know About Probate

We get a lot of questions about the differences between a will and a trust – but there are a few more distinctions we think you should know.

Understanding how to protect your assets and your family requires knowledge of what protections your will, trust, or testamentary trust actually grants you and your beneficiaries.

Continue reading Deciding Between a Will and a Trust? The Distinctions You Need to Know →

Posted in assest protection, Estate Planning, Living Trusts, Trusts

Selecting a Successor Trustee: Is a Family Member Really the Best Option For You?

Last modified: November 10, 2023

Should You Choose a Corporate Trustee or Appoint Someone You Know?

When a family establishes a revocable trust, the grantor is, in many cases, the trustee as well. However, a revocable trust requires that the grantor appoints a successor trustee.

The successor trustee is on standby until the acting trustee dies or becomes mentally incapacitated and is unable to manage the trust.

You may think you know whom you would choose as a successor trustee, but it’s not as simple as appointing a family member and calling it a day. The successor trustee has many essential functions that take up time and resources.

If your family appoints this person, you must consider how other family members will view it and ensure there are no conflicts of interest.

Continue reading Selecting a Successor Trustee: Is a Family Member Really the Best Option For You? →

Posted in assest protection, Estate Planning, Trusts 1 Comment

Kaestner and Fielding: SCOTUS Implications Create Opportunities

Last modified: November 10, 2023

Kaestner wins, Fielding Denied: What we can learn when analyzed together. 

On June 21, 2019, in North Carolina v. Kimberley Rice Kaestner 1992 Family Trust, Docket No. 18–457, the United States Supreme Court (SCOTUS) ruled that the residency of a beneficiary in a U.S. state alone was not sufficient nexus (connection) for a state to tax the undistributed net income of a trust. 

Many commentators have written about the case and its implications. However,  SCOTUS declining the writ of certiorari to Minnesota’s Fielding case right after deciding on Kaestner should not be overlooked.

Continue reading Kaestner and Fielding: SCOTUS Implications Create Opportunities →

Posted in Taxes, Trusts Tagged , ,

Kaestner v. North Carolina: the Most Significant Trust Case In Nearly a Century

Last modified: November 10, 2023

SCOTUS Sides with Family Trust Over the State of North Carolina

The United States Supreme Court ruled on June 21st, 2019 that the taxation of The Kimberley Rice Kaestner 1992 Family Trust by the North Carolina Department of Revenue is unconstitutional.

The much-anticipated ruling stated that the presence of in-state beneficiaries alone does not empower a state to tax trust income. Beneficiaries experience more protection before a trust distribution and when the beneficiaries have no right to demand, nor are they sure to receive the income.

Continue reading Kaestner v. North Carolina: the Most Significant Trust Case In Nearly a Century →

Posted in assest protection, Trusts
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