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2033

2033. Interest in property owned individually. 2036, 2037, 2038. “… in contemplation of or intended to take effect in possession or enjoyment at or after his death …”. 2036. W Inc. to H, life, then Inc. to W, life, then Rem. to children. Trust. 2036. G Inc. to G, life, then

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2033

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  1. 2033 • Interest in property owned individually

  2. 2036, 2037, 2038 • “… in contemplation of or intended to take effect in possession or enjoyment at or after his death …”

  3. 2036 W • Inc. to H, life, then • Inc. to W, life, then • Rem. to children Trust

  4. 2036 G • Inc. to G, life, then • Rem. to children Trust

  5. 2036 • Transfer by decedent • Retention for the prohibited time, of • (a) (1), (2)

  6. 2036 • Prohibited time • Life • Not ascertainable without reference to death • Does not in fact end before death

  7. 2036 • (a) (1) possession, enjoyment or income • (a) (2) control, designate persons • alone or in conjunction with • (b) anti-Bynum rule

  8. 2036 • 1984 - SP $270,000 Gift (20,000) Mtg. $250,000 • 1985 - forgave $20,000 • 1986 - forgave $20,000 • 7/86 - dies • 12/86 - sold $550,000

  9. 2036 A B • Reciprocal trust doctrine applies to all interests and powers Inc. B Rem. to B’s children Inc. A Rem. to A’s children

  10. 2038 • Alter, amend, revoke or terminate • Alone or in conjunction with • UGMA /UTMA • Living trust • Removal and replacement of trustee • Reciprocal trust

  11. 2041 Power of Appointment S2 Inc. T-ee Invade Children Rem. S2 Test. P/A Children S2 5 & 5 S2 Appt. to self S2 Test. P/A S1

  12. 2041 Power of Appointment • General • Special / Limited

  13. 2039 Annuities • Concept • Single life / no balance • Single life / balance • Self and survivor • Joint and survivor • Contributions and wealth transfer • Employee status • 2056

  14. 2039 Annuities Amt. Incl. = D’s contrib. X Annuity value Purchase Price

  15. 2040 Joint Interests • Tenancy in Common • Joint Tenancy • Convenience v. property interest • POA Acct. v. JTROS • Tenancy by Entireties • Community Property

  16. 2040 Joint Interests • 2040(a) • Contribution test • 2040(b) • One-half • Gallenstein

  17. 2040 Joint Interests Amt. Excl. = Survivor’s consid. X Value Total consid.

  18. 2042 Life Insurance • Protection • Liquidity • Wealth Creation • Wealth Replacement • Term v. Permanent

  19. 2042 Life Insurance • receivable by executor • incidents of ownership

  20. 2035 Gifts/3 Years of Death • Seldom applies, BUT • Gift tax inclusion inadequate • Life insurance • Revocable trusts

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