Estate planning is more than just planning for death. It includes building an estate during a lifetime, then seeing that those assets are protected in an estate that can be passed to the next generation. It allows you the opportunity to control your success both during life and at death. Whether a person is a business owner or an employee, young or retired, wealthy or poor, they should plan their estate. Even those without assets need to deal with old age, possible conservatorship, health care directives, and funeral arrangements. Estate planning is for everyone.
This comprehensive course surveys wills, living trusts, gifts, marital property, and probate avoidance. Will and trust forms are explored along with living wills, durable powers of attorney, and nominations of conservator. Designed to eliminate estate problems and death taxes, the emphasis is on practical, cost effective solutions.
Upon successful completion of this course, participants will be able to:
- Identify the basic elements of estate planning, noting the importance of well-drafted legal documents.
- Specify the key team participants in the estate planning process, noting their roles in the estate planning process.
- Recognize the major steps in the probate process and identify ways to make transfers outside the probate system.
- Specify estate tax techniques that save death taxes while retaining maximum control.
- Categorize estate-planning facts into categories to develop an information base for an estate plan.
- Identify potential death taxes including the federal estate tax as it applies to various size estates.
- Specify the principal taxes that impact death taxation.
- Define taxable estate under §2501 and determine what assets are included in a gross estate.
- Determine the value of a decedent's assets using permitted elections, noting the use of the Form 706 to pay any estate tax due.
- Specify the tax basis of estate assets, noting how common transactions affect property basis under §1014.
- Identify the requirements, advantages, and disadvantages of gift taxation, noting the impact of the GST, the steps to compute gift tax, the gift tax exclusion amount, and the value of the gifts including those that are split.
- Identify gift tax exclusions, noting the tax treatment of below-market loans and the requirements for the gift tax marital deduction.
- Determine the tax consequences of giving various assets, noting factors to consider when gifting.
- Recognize the components and usage of Form 709 to compute and pay federal gift tax.
- Identify different types of wills and the functions they perform.
- Specify the duties performed executors and guardians.
- Cite ways to hold title, recognizing their tax ramifications.
- Identify advantages of a properly drafted will, noting the distribution flow of simple wills.
- Specify the pros and cons of probate proceedings.
- Identify different types of trusts, recognizing the various reasons for establishing a trust, the relationship of parties in a trust, and their estate planning function.
- Specify recommended living trust provisions.
- Identify the application of gift and income tax including the use of a grantor trust and an unlimited marital deduction.
- Determine what constitutes an 'A-B' and 'A-B-C' trust format.
- Recognize the basic tax and legal title formats and distinguish between them.
- Specify the advantages and disadvantages of holding property individually and through a sole proprietorship or a corporation, noting how to avoid associated title pitfalls.
- Determine primary groups of C corporations, noting the estate-planning problems associated with each.
- Cite advantages that partnerships can have over corporations.
- Identify S corporation rules, noting applicable advantages and disadvantages for S corporations as well as for incorporating a farm.
- Specify the title holding and tax characteristic benefits of trusts, co-tenancy, partnerships, and limited liability companies.
- Identify how title can be held on behalf of minors as well as the tax treatment of custodianships and of a probate estate.
- Specify persons in which rights are placed by life insurance as well as reasons to purchase life insurance.
- Identify the tax treatment of life insurance proceeds.
- Determine the treatment of premiums for personally owned life insurance and related benefits, specifying exceptions to this treatment including the transfer for value rule.
- Identify variables that influence whether life insurance is taxable for federal estate tax purposes.
- Cite the gift tax associated with transfer of life insurance policies.
- Specify the pros and cons of various types of life insurance policies.
- Identify reasons for establishing an irrevocable life insurance trust as well as items to consider when establishing a life insurance trust.
- Note the differences between deferred annuities and private annuities.
- Determine what constitutes an entity purchase agreement and a cross purchase agreement, noting tax and legal advantages.
- Cite reasons that a business interest must be valued in an estate that is subject to federal estate tax.
- Specify factors used to determine the net value of a business under the regulations.
- Recall the valuations factors in R.R. 59-60, noting their impact.
- Determine how tangible assets are normally valued, identifying those assets whose valuation is based on values other than book value.
- Specify the steps in R.R. 68-609’s valuation formula for intangible assets, noting the effect such amount can have on the total value of a business.
- Identify special business valuation issues including redemptions under §303.
- Determine the tax consequences of leaving an estate to a surviving spouse.
- Specify the basic elements of buy sell agreements, stock redemptions, and stock recapitalizations.
- Identify deferred compensation agreements noting their estate planning impact.
- Determine the benefits of an estate freeze, noting its ability to reduce the value of a business interest.
- Identify the important aspects of §2701, including applicable transactions and exceptions.
- Recognize the components of the “zero value” rule, noting the qualified payment exception and its consequences, variables that impact the application of §2701, and junior equity interest rules and valuation.
- Specify the treatment of a capital contribution under §2701.
- Determine when an individual is deemed the owner of an interest that is held indirectly through a corporation, partnership, trust, or other entity based on the §2701 attribution rules.
- Specify when transfer tax adjustments will be made to transfers or inclusions in the gross estate.
- Identify the split of an applicable retained interest allowing value to be given to a participating feature of a participating preferred interest.
- Specify the stepped computation under the subtraction method to determine an amount of a gift resulting from a transfer to which §2701 applies.
- Identify the important aspects of §2702, including terminology concerning transfers of interest in trust and applicable exceptions.
- Determine the transfer of an interest in property when there are one or more term interests as a transfer of an interest in a trust.
- Specify the treatment of joint purchases.
- Recognize key terms, requirements, and exceptions under §2703 and §2704, noting applicable restrictions.
- Identify management techniques for the elderly and disabled, including benefits and drawbacks associated with joint tenancy, conservatorship, and durable power.
- Cite the basic eldercare benefits of Medicare, Medicaid, and Supplemental Security Income, noting applicable disadvantages related to the Medicaid program.
- Determine how to divide income into asset groups.
- Specify the dangers and benefits of gifting to family members.
- Identify how individuals can use private insurance as a short-term solution for catastrophic illness.
- Identify tools that can allow patients to refuse treatment even when incompetent.
- Determine Supplemental Security Income, noting how it relates to elderly and disability planning.
- Cite the requirements that must be met in order to receive disability benefits.
- Identify techniques to strengthen post-mortem estate planning through using elections and disclaimers.
- Specify the due dates of various post-mortem federal forms as well as the requirements of a decedent’s estate tax return.
- Cite exceptions to the general rule of estate tax payment.
- Determine the processes and procedures necessary in preparation and for filing of the Form 706.
- Identify the filing requirements for estate income tax returns and for the decedent’s final income tax return.
- Determine the estate income tax under available tax accounting methods and tax years.
- Specify the use of Form 1310 for a decedent or a joint return for a decedent and their surviving spouse.
- Determine total income to be included on the decedent’s final income tax return using available exemptions or deductions.
- Identify how to avoid penalties when filing a gift tax return, recognize gift splitting techniques that reduce gift taxes, and recall special gift applications and traps noting ways to avoid their tax consequences.
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