Colorado Probate Blog - Wade Ash Woods Hill & Farley, P.C.

Family Business Valuation Proposed Regulations Withdrawn

In a notice issued by the IRS on October 17, 2017, Treasury has withdrawn the Proposed Regulations issued August 4, 2016 concerning the estate, gift and GST tax treatment of valuation of family-controlled businesses. These regulations were issued under Code Section 2704 and would have impacted planning involving the valuation of such interests for transfer tax purposes. After the proposed regulations were issued, numerous written comments were submitted and a public hearing was held on December 1, 2016. President Trump issued Executive Order 13789 on April 21, 2017, instructing the Secretary of the Treasury to review tax regulations issued on or after January 1, 2016, and to submit a report to the President by September 18, 2017. The Secretary recommended that the proposed regulations be withdrawn, and the Treasury Department and IRS have now done so.

  631 Hits
631 Hits

Highway Bill Contains Some Tax Provisions

On July 31, 2015, the President signed H.R. 3236, the "Surface Transportation and Veterans Health Care Choice Improvement Act of 2015" which primarily continues the highway trust fund for another three months. Included in the bill is a requirement for consistency for large estates (those required to file an estate tax return): the estate must report the value of property included in the gross estate (date of death or alternate value), and the same value must be used for income tax basis reporting. Any underpayment of tax due to understatement of basis would be subject to a 20% accuracy-related penalty, and the bill also clarifies that the 6-year statute of limitations applies where an overstatement of basis results in a substantial (25% or more) omission of income.

  1313 Hits
1313 Hits

President’s Budget Includes Changes Affecting Estate Plan

The President released his budget on April 10, 2013. While this does not mean these provisions will become law, they could be part of a tax reform package later this year. Some of the changes include: (1) a $3 million cap on IRAs and retirement plan; (2) Inherited IRAs would have to be paid out in 5 years instead of over the beneficiary’s life expectancy; (3) Generation-skipping transfer tax exemption applicable to trusts would expire after 90 years; (4) Grantor retained annuity trusts would have a minimum term of 10 years; and (5) coordination between the value of an asset reported on the U.S. Estate Tax Return and the beneficiary’s reported basis on a sale.
  1290 Hits
1290 Hits