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  • What usually is the significant income tax advantage of owning community property at death?
    What usually is the significant income tax advantage of owning community property at death?
    1. all community property receives a step-up in basis upon the death of the first spouse, and all community property owned by the survivor receives an additional step-up at the survivor\ s death.-correct answer - a. the potential advantage of community property is that both the deceased spouses half of the community property and the survivors half receive a step-up in basis when the first spouse dies. alaska permits non-alaskan couples to create alaska community property by creating and funding an alaska community property trust. see, generally, blattmachr, zaritsky and ascher, tax planning with consensual community property: alaskas new community property law, 33 real prop. prob. & tr.j. 615 (winter 1999). the wealth transfer planning system has a profile or template by which such trusts (which is a form of joint revocable trust) may easily be constructed.

  • Why does Tereza pyrope (and other trolls) say jegus (rather thean jesus)?
    Why does Tereza pyrope (and other trolls) say jegus (rather thean jesus)?
    Because of a typo. Because of Dave.

  • Which cartoonist created 'The Far Side'?
    Which cartoonist created 'The Far Side'?
    The one who created “The Far Side” is Gary Larson. He was a cartoonist who was able to show a different side through the cartoons that he created. The cartoons had a humor that was considered to be surrealistic. The cartoon used to be called “Nature’s Way” but when it was bought by the San Francisco Chronicle, the cartoon was changed. It was actually a surprise for Larson that it was actually accepted. Larson said that he found it funny that there were a lot of people who misunderstood the actual meaning of the cartoons that he created. He retired in 1997 but he drew a cover for The New Yorker magazine in 2003.

  • When is it appropriate to structure an estate plan for a married person using portability (that is, the inheritance by the surviving spouse of the unused exemption of the first to die) to the...
    When is it appropriate to structure an estate plan for a married person using portability (that is, the inheritance by the surviving spouse of the unused exemption of the first to die) to the...
    1. almost never-correct answer - d. today, portability is a mirage. it is scheduled to disappear from the law after 2012. even if it is made permanent, it almost never will be more efficient than using the estate tax exemption of the spouse first to die. moreover, although the unused estate tax exemption of the spouse dying first may be inherited for use by the surviving spouse, the unused gst exemption of the spouse dying first cannot be. in addition, there are many uncertain but important issues about portability. even if the client wants the simplest plan and counseling possible, using portability will likely make it even more complex for several reasons. first, the lawyer will have to explain the negative effects of portability (some but not all of which are stated above). second, the lawyer may have to run calculations to demonstrate the advantage or disadvantage of using portability. third, using portability likely means leaving the entire estate of the spouse first to die outright to the surviving spouse. (if a marital deduction trust is used then using or potentially using the estate tax exemption of the spouse first to die will have been built into the estate tax.) one possible circumstancewhere portability might produce a better resultis where the client assumes there will be significant appreciation after his or her death and by the time the surviving spouse dies. using portability means the assets the surviving spouse inherits may receive a second step up in basis under section 1014 of the internal revenue code when the survivor dies. that would not occur if the assets had been left in a so-called credit shelter or bypass trust. nonetheless, if significant appreciation does occur between the deaths of the spouses, much more will be included in the gross estate of the surviving spouse meaning a higher estate tax. unless it is anticipated that the code will be rewritten so the effective estate tax on the appreciation is lower than what the income tax would be on the gain, portability likely will be inefficient even where such appreciation is anticipated. in addition, it may be possible to simulate the effect of a step up in basis using a supercharged credit shelter trust(sm). see gans, blattmachr & zeydel, probate & property, july/august 2007, pg. 52. the wealth transfer planning system has a profile or template by which such trusts may easily be constructed..

  • When should trusts be used in an estate plan?
    When should trusts be used in an estate plan?
    1. almost always-correct answer - a. the extensive use of trusts is probably the most important recommendation a lawyer can make to an estate planning client. among other benefits, trusts provide asset protector for the inheritors including from claims arising in divorce, avoid disqualification from certain governmental benefits (such as medicaid), protect against the almost inevitable loss of management skills by the inheritor and can be used to reduce income and wealth transfer taxes. see, generally, blattmachr, the right answer: put it all in trust, trust & investments, september/october 1998, republished in nysba elder law attorney, winter 2000, vol. 10, no. 1 at pg. 12.

  • Which is the best asset with which to fund a charitable bequest?
    Which is the best asset with which to fund a charitable bequest?
    1. interest in a non-roth ira-correct answer - b. why is a incorrect? in fact, a roth ira likely is the most valuable asset for a non-charity to inherit because there is no inherent income tax liability for the amount in the account at death and even for most death income earned in the account. why is c incorrect? it would be better to sell the asset once death occurs and the step up in basis occurs. why is d incorrect? because the negative basis is, in effect, forgiven when the property owner dies. b is correct because a bequest of an interest in a non-roth ira (which does not receive a step up in basis at death) avoids both estate tax and income tax. if the client does not hold a non-roth ira, the charitable bequest should be made with another asset that is the right to income in respect of a decedent.

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