President Approves One-Year Extension of Charitable IRA Rollover
On December 19th, President Obama signed H.R. 5771, known as the “Tax Increase Prevention Act of 2014.” Among other things, this legislation extends the favorable charitable IRA rollover rule to gifts made in 2014. Continue reading “President Approves One-Year Extension of Charitable IRA Rollover”
ESTATE AND GIFT TAX EXEMPTION ANNOUNCED FOR 2015 GIFT TAX ANNUAL EXCLUSION REMAINS UNCHANGED
The combined estate and gift tax exemption was set at $5,000,000 in 2011, but indexed for inflation. For deaths in 2014 and for gifts made in 2014, the inflation-adjusted exemption was $5,340,000. The IRS has announced that for deaths or gifts in 2015, the exemption amount will increase to $5,430,000. Thus, in only four years, the amount a married couple can gift or bequeath without incurring estate or gift tax has increased from $10,000,000 to almost $10,900,000. Continue reading “ESTATE AND GIFT TAX EXEMPTION ANNOUNCED FOR 2015 GIFT TAX ANNUAL EXCLUSION REMAINS UNCHANGED”
California Enacts Bill to Combat Noncompliant Charities
The California State Legislature recently passed Assembly Bill 2077 (“AB 2077”). AB 2077, which was signed by Governor Brown, is designed to make it more difficult for charities that have not complied with their registration and reporting obligations to operate in California. Continue reading “California Enacts Bill to Combat Noncompliant Charities”
California (Finally) Conforms to Federal Treatment of UBTI in Charitable Remainder Trusts
One of the most important tax attributes of charitable remainder trusts is that they are exempt from income tax – except, that is, when it comes to unrelated business taxable income (UBTI) of these trusts. For decades the rule was that if a CRT had any UBTI at all, even an amount that was inconsequential compared to the overall net income of the trust, the trust would lose its tax exemption for the year, and become fully taxable just like any other complex trust. This rule could undo some of the best tax planning with CRTs, Continue reading “California (Finally) Conforms to Federal Treatment of UBTI in Charitable Remainder Trusts”
Employer Reimbursement of Employee’s Individual Medical Insurance May Subject Employer to Penalty
IRS Notice 2013-54 provides that an employer’s reimbursement of healthcare insurance premiums paid by an employee on an individual health insurance contract of the employee on a pre-tax basis (an “employer payment plan”) may violate: Continue reading “Employer Reimbursement of Employee’s Individual Medical Insurance May Subject Employer to Penalty”
Tax Issues Related to Settling Employment-Related Claims
Unfortunately, just about every employer has to deal with claims made by employees or former employees. These claims can be for a variety of alleged “wrongs” such as failing to pay overtime, age discrimination and sexual harassment. In most cases these matters are resolved between the parties without a trial. Continue reading “Tax Issues Related to Settling Employment-Related Claims”
IRS Rules on Private Foundation Ownership of Apartment Building
A recent IRS ruling illustrates the application of the IRC § 4943 excise tax on excess business holdings, as well as the tax on unrelated business taxable income (UBTI), in the context of an apartment building owned by a private foundation. Continue reading IRS Rules on Private Foundation Ownership of Apartment Building
Sale of Clippers Will Cost Sterlings Significant Income Taxes
People who do not think that Donald Sterling is being impacted sufficiently by the NBA fine and being forced to sell the Los Angeles Clippers are not taking into account the significant federal and California income taxes that the Sterlings are going to be required to pay on the sale of the team. Continue reading “Sale of Clippers Will Cost Sterlings Significant Income Taxes”
Hey Kids, Let’s Have An Advance Health Care Directive
The recent death of Hollywood legend Mickey Rooney immediately was followed by a fight over the disposition of his remains. While Mr. Rooney’s body remained at a funeral home, various factions within his family fought for the right to determine where and how he would be buried. Fortunately for the dignity of Mr. Rooney, the fight was settled quickly, before a court could decide the matter. Continue reading “Hey Kids, Let’s Have An Advance Health Care Directive”
Bankruptcy Protection for Inherited IRA
The already complicated subject of how to handle Individual Retirement Accounts following the death of an IRA holder just got a little more complicated with the recent Supreme Court decision in Clark v. Rameker. The issue in this case was whether an “inherited IRA” enjoyed the same protections under federal bankruptcy law as other IRAs. The Supreme Court held that it did not, making it easier for creditors to reach the assets held in these types of IRAs. Continue reading “Bankruptcy Protection for Inherited IRA”
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