Re: how to compare living standards

On Mon, 10 Apr 2006 18:35:21 -0400, "tonyp" <tonyp@xxxxxxxxxxxxx>
wrote:

"William F Hummel" <wfhummel@xxxxxxxxxxx> wrote

On the death of the second spouse, the successor trustee
(whoever you have named in the trust) will terminate
by the distributing the assets to the beneficiaries
after first paying the estate tax on that portion
of the survivor trust that exceeds the exemption amount.

Aha. Actual information! William, for Jim's benefit as well as mine, can
you say a couple of words on:

1) The difference between "trustee" and "beneficiary". Jim seemed to
conflate the two.

The "trustee" is the one who is responsible for managing the assets of
the trust, and is normally the "trustor" or "grantor", i.e. the ones
who funds the trust. In a typical living trust, the husband and wife
fund the trust as grantors, and are also the trustees while they live.

The beneficiaries are the named individuals who will receive the
assets of the trust as specified in the trust document itself.
Typically the children would be the beneficiaries, and are often named
as the successor trustees (on the death of the second spouse to die).

2) The unified lifetime gift-and-estate tax exemption. There is an intimate
tie between the gift tax and the estate tax, as both tax lawyers and the IRS
understand.

I'm speaking now of non-charitable gifts. Any gift in excess of
$12,000 per year to an individual is subject to a Federal gift tax by
the donor. The donor can give up to $1 million in excess of the
annual tax-free amount during his lifetime without having to pay a
gift tax by applying the gift tax credit. However that taxable gift
reduces that estate tax exemption by the same amount.

For example, say you give $200,000 as a gift to your kids over an
above the yearly tax-free gift allowance. When your heirs have to
settle the estate on the death of the second spouse, the estate
exemption amount will be that much less.
.

Relevant Pages

  • Re: *****OFF TOPIC"****** trusts and taxes
    ... with corrections for 2005 income and get that tax return done. ... nzlstar at yahoo dot com ... i find out new info on closing my moms 'living trust'. ... he told me i need a new estate tax number. ...
    (rec.crafts.textiles.quilting)
  • Re: *****OFF TOPIC"****** trusts and taxes
    ... with corrections for 2005 income and get that tax return done. ... nzlstar at yahoo dot com ... i find out new info on closing my moms 'living trust'. ... he told me i need a new estate tax number. ...
    (rec.crafts.textiles.quilting)
  • Re: *****OFF TOPIC"****** trusts and taxes
    ... with corrections for 2005 income and get that tax return done. ... nzlstar at yahoo dot com ... i find out new info on closing my moms 'living trust'. ... he told me i need a new estate tax number. ...
    (rec.crafts.textiles.quilting)
  • Re: gift and estate tax exclusions
    ... 12k per year may be given with no tax ... This reduces the unified gift exclusion ... Lets say that, when mom dies, the estate tax exclusion, tax rates, etc, are ...
    (misc.taxes)
  • gift and estate tax exclusions
    ... 12k per year may be given with no tax ... This reduces the unified gift exclusion ... Lets say that, when mom dies, the estate tax exclusion, tax rates, etc, are ...
    (misc.taxes)
Loading