<html><head><meta http-equiv="content-type" content="text/html; charset=utf-8"></head><body dir="auto">Josh:<div><br></div><div>Maybe. But the idea has been around for a long time. It looked like it might go away in the late 1970’s under Carter. But they backed away because the administrative and compliance hassle of a multigenerational basis carryover is just too daunting. </div><div><br></div><div>I’ve always thought the Canadians had a better idea (maybe it’s still the law). No estate tax, but capital gains are taxed at 15%, eliminating the carryover basis problems. </div><div><br></div><div>John J. Sullivan<br><br><div dir="ltr">Sent from my iPhone</div><div dir="ltr"><br><blockquote type="cite">On May 11, 2021, at 10:26 AM, Josh Grant <jgrant@accima.com> wrote:<br><br></blockquote></div><blockquote type="cite"><div dir="ltr">
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<div><font size="4">and there is a good chance that the step up in basis is going
away. So we should see what happens and then yes do the CLE</font></div>
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<div><strong><span style="FONT-SIZE: 18pt; COLOR: #004080">Joshua F.
Grant</span></strong><span style="COLOR: #004080"><br></span><span style="COLOR: black"><div><advocates[3].png></div><br></span><span style="FONT-SIZE: 11pt; COLOR: #004080">P.
O. Box 619<br>Wilbur, WA 99185<br>509 647 5578</span><span style="COLOR: black"><o:p></o:p></span></div></div></div></div>
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<div style="font-color: black"><b>From:</b> <a title="michael@westseattleattorney.com">michael westseattleattorney.com</a> </div>
<div><b>Sent:</b> Tuesday, May 11, 2021 7:39 AM</div>
<div><b>To:</b> <a title="wsbarp@lists.wsbarppt.com">'WSBA Real Property
Listserv'</a> </div>
<div><b>Subject:</b> Re: [WSBARP] Estate Tax Avoidance</div></div></div>
<div> </div></div>
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<div style="FONT-SIZE: 11pt; FONT-FAMILY: "Times New Roman", times, serif; COLOR: rgb(0,0,0)">Hi:
How about a CLE as this seems to come up a lot and with the increases in equity
and government trend to get it and reduce the tax exemptions/deductions, we all
could use a course on use of such things as the A-B-C trusts, and other tools in
this area. But I mean a good focused CLE using examples , hypos, form provisions
and why. Just an idea ! Mike Atkins </div>
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<div id="divRplyFwdMsg" dir="ltr"><font style="FONT-SIZE: 11pt" color="#000000" face="Calibri, sans-serif"><b>From:</b> wsbarp-bounces@lists.wsbarppt.com
<wsbarp-bounces@lists.wsbarppt.com> on behalf of John J. Sullivan, Esq.
<sullaw@comcast.net><br><b>Sent:</b> Monday, May 10, 2021 9:41
PM<br><b>To:</b> 'WSBA Real Property Listserv'
<wsbarp@lists.wsbarppt.com><br><b>Subject:</b> Re: [WSBARP] Estate Tax
Avoidance</font>
<div> </div></div>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">Jim:</p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">Keep in
mind that if you gift a capital asset while alive (real estate or securities)
the recipient does NOT get a step up in basis at death. So gifting should
ideally be of cash.</p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">John J.
Sullivan</p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><b>From:</b>
wsbarp-bounces@lists.wsbarppt.com <wsbarp-bounces@lists.wsbarppt.com>
<b>On Behalf Of </b>John J. Sullivan, Esq.<br><b>Sent:</b> Monday, May 10, 2021
9:38 PM<br><b>To:</b> 'WSBA Real Property Listserv'
<wsbarp@lists.wsbarppt.com><br><b>Subject:</b> Re: [WSBARP] Estate Tax
Avoidance</p></div></div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">Jim:</p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">If they
are both citizens each enjoys a lifetime exemption this year of $2.193M. So as
long as you design their wills/RLT to not waste the exemption of the first
decedent you are almost home. Also, WA has no gift tax, so the second decedent
can gift near death. </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">A TOD
deed most certainly does not remove the real property from either estate and
could make it difficult to implement the common “disclaimer trust” strategy for
capturing the first decedent’s lifetime exemption. Same with the financial
assets. The gross estate includes everything the decedent had control of at the
moment of death. </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">The
$30,000 figure? I’m guessing you mean the $15,000 annual exclusion for each of
them to any one recipient from federal gift taxes. So they can gift up to
$30,000.00 to any one recipient together without filing a gift tax return. But
again, there is no WA gift tax. <br><br>All they need is a standard plain
vanilla disclaimer trust design that QTIPs the credit shelter trust for federal
purposes to secure a second step up in basis. Every married couple plan should
be able to shelter up to $4,386,000 without doing anything fancy or aggressive.
They’re only $214,000.00 over the combined threshold. Consider having the
survivor make gifts as near as death as necessary to assure not running out of
funds.</p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">I’m
coming to this late, so if anyone has already set this out, I apologize for
repeating.</p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">John J.
Sullivan</p>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><b>From:</b>
<a>wsbarp-bounces@lists.wsbarppt.com</a>
<<a>wsbarp-bounces@lists.wsbarppt.com</a>> <b>On Behalf Of </b>Jim
Doran<br><b>Sent:</b> Monday, May 10, 2021 12:45 PM<br><b>To:</b> WSBA Real
Property Listserv <<a>wsbarp@lists.wsbarppt.com</a>><br><b>Subject:</b>
[WSBARP] Estate Tax Avoidance</p></div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p>
<div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><span style="FONT-SIZE: 13.5pt">Death and Taxes:</span></p>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p></div>
<div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><span style="FONT-SIZE: 13.5pt">Married clients are getting old. They want to
know what they can do to shelter their assets from inheritance tax here in
Washington. They have a home worth $600,000.00 and financial assets of
roughly $4,000,000.00. When we do the calculations the inheritance tax
would be $301,050.00 upon the death of the second spouse if they do not dispose
of any of the assets. </span><span style="FONT-SIZE: 18pt">We need to
shelter $2,407,000.00. </span></p></div>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p></div>
<div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><span style="FONT-SIZE: 18pt">I have two questions off the bat. All this talk of
Transfer on Death Deeds makes me wonder if they do a TODD will that keep the
real property out of the "estate" for purposes of the estate tax? The
second question is if they make specific beneficiaries for $2,407,000.00 worth
of their financial investments, will that keep that amount out of the estate tax
calculation?</span></p></div>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p></div>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><span style="FONT-SIZE: 18pt">And I do know that as a married couple they can gift
$30,000 per year per person, but they don't want to do that for personal
reasons.</span></p></div>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p></div>
<div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><span style="FONT-SIZE: 18pt">I am sure there are other ways to do this. Any
ideas that are not too complicated would be appreciated.</span></p></div>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p></div>
<div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><span style="FONT-SIZE: 18pt">I appreciate it.</span></p></div>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"> </p></div>
<div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><span style="FONT-SIZE: 18pt">Jim Doran</span></p></div>
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<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">James R.
Doran</p></div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">Attorney
at Law</p></div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">100 E.
Pine Street - Suite 205</p></div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in">Bellingham,
WA 98225<br>(360)393-9506</p></div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><a target="_blank">jim@doranlegal.com</a></p></div>
<p class="x_MsoNormal" style="FONT-SIZE: 11pt; FONT-FAMILY: calibri, sans-serif; MARGIN: 0in"><a href="http://www.doranlegal.com" target="_blank">www.doranlegal.com</a></p></div></div></div></div></div></div></div></div>
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