Crummey Powers in Estate Planning
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Understand how Crummey Powers can be used to achieve your client's estate planning goals.
The decision in Crummey v. Commissioner directly addressed a fundamental flaw in tax policy - the inability for parents to make annual gift tax exclusion gifts to their children in trust. After Crummey, parent-donors had a procedure by which to make such exclusion gifts. Indirectly, the Crummey decision spawned the rise of Crummey Powers in estate planning affording taxpayers and their advisors the ability to reduce methodically their gross estates and avoid estate and gift tax consequences. This topic will assist estate planners in understanding the development and practical application of Crummey Powers giving them a powerful tool to assist clients with achieving their estate planning goals.
Speaker: Todd L. Denison
Program Topics:
Overview: Crummey Powers
- Definition
- Generally
- Naked Crummey Powers
- SemiNaked Crummey Powers
Historical Background
Annual Gift Tax Exclusion
The Key Issue
- Gift of a Present Interest
- Definition of a Present Interest
Crummey v. Commissioner
- Analysis of Issues
- Case Legacy
Estate Planning Use of Crummey Powers
- Irrevocable Trusts
- Irrevocable Life Insurance Trusts
Expanding Crummey Powers – Cristofani v. Commissioner
- Analysis of Issues
- Use of Cristofani
Crummey Powers – a Usage Guide
- Typical Trust Language
- Examples
- Lapse Issues
- Hanging Powers
- Trustee Responsibilities
- Crummey Notice
- Crummey Waiver
- Problem Areas
- Parental Control Over a Minor Child's Crummey Powers
- Informal Agreements for Waiver
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