[WSBAPT] My first TEDRA??

[John J. Sullivan]

Amanda:

All of Sam's points are worthy of consideration. As is the benefit of a second step up in basis if the trust is collapsed and the assets (depending on their nature and W's life expectancy) made a part of her gross estate. 

One other suggestion. I have done numerous TEDRA agreements waiving the mandatory split or unwinding it. I don't usually file. I waive notice so it can be filed later. But I'm always very careful to articulate in the TEDRA who my client is and whom I do not represent. I add that the others are encouraged to seek separate counsel and in at least one case where the kids were still in their 20s had mom offer to pay for the advice. You don't want one of these haunting you as you're preparing to retire. 

John Sullivan

Sent from my iPhone

> On Jun 9, 2015, at 4:38 PM, Sam Furgason <sam at furgasons.com> wrote:
> 
> Amanda,
>  
> I’d like to make an observation: Most irrevocable decedents’ trusts funded as a result of the death of one spouse of a joint revocable living trust have more to offer than just tax savings. For example, creditor protection, SNT language, identity theft or protection of the first spouse’s assets from unscrupulous people who would take advantage of the elderly. While the surviving spouse may think she may never lose her mental faculties, that does happen to anyone who lives long enough. I look on the cost of a simple 1041 not as a nuisance, but as a (deductible) insurance premium. And she will still have the same income tax return and tax obligation even if one or both of the trusts are terminated.
> S  
>  
> From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of amanda_wilson at olypenlawoffices.com
> Sent: Tuesday, June 09, 2015 4:09 PM
> To: WSBA Probate & Trust Listserv
> Subject: [WSBAPT] My first TEDRA??
>  
>  
> Client asked me to review A/B Trust. It has been meticulously administered since her husband's death a few years ago and the accountings are all in order.
>  
> However, the combined estate is around $1 million.
>  
> My client and her late spouse had two children together, who are the heirs under the decedent's trust and the survivor's trust. My client has no intention of changing the beneficiaries.
>  
> My client is tired of managing two trusts and paying the CPA at tax time each year, I do not think an estate tax would be owed on the combined estate. The two adult children have good relationships with their mother and would be willing to to sign things that benefit the mom....
>  
> Can my client and the kids all sign affidavits agreeing to the termination of the decedent's trust? Is a TEDRA action necessary? What would we need to do to appease (or not anger) the IRS since the decedents Trust is "registered" and has an EIN already?
>  
> Amanda Wilson
>  
> Amanda M. Wilson, esq.
>  
> Olympic Peninsula Law Offices, LLC
> P.O. Box 115
> Port Townsend, WA 98368
>  
> (360)437-4172 office
> (206)331-7851 cell phone
>  
> "Your words are the greatest power you have. The words you choose and their use establish the life you experience."
> -Sonia Croquette
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