[WSBAPT] [SPAM] Represent Crummey Trust, grantor pays attorney

[Mike Morita]

Has anyone ever taken third-party payments for legal services from
grantors of Crummey trusts and determined the gift tax implication?

Background:
I advise the trustee of a Crummey trust that I set up for the grantor, and
the grantor makes maximum additions to the trust that avoid gift taxes.
Ordinarily, I would bill the trustee for legal advice, and she would pay
out of the trust principal. However, the grantor has offered to pay the
trust's legal bills. (and of course, I would follow all RPC guidelines for
3rd party payments)

Are the grantor's payments for the trust's legal fees analogous enough to
life insurance premiums that the trustee would need to send Crummey
statements and count the amount against the gift tax maximum?

My inclination is yes, and to just take payment from the trustee. But if
I'm wrong, the trust would build principal faster to the benefit of trust
beneficiaries, so I'd love for someone to contradict me.

Thanks,
Mike

-- 

Morita Law PLLC

1617 Boylston Avenue

Seattle, WA 98122
Ph: 206-905-1004
Fax: 206-707-8324
www.MoritaLaw.com

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