Here is your copy of the most recent Family Wealth Compass.
This publication offers a timely roundup of estate and trust planning tips, information and news, courtesy of Gunster's private wealth services attorneys; please contact any team member for more information.
In this latest issue, you'll find information on the following topics:
IRS proposal severely limits valuation discount planning
Last month the United States Treasury issued proposed regulations to Section 2704 of the Internal Revenue Code. It appears that these regulations will have a dramatic effect on the ability of taxpayers to utilize minority interest and lack of marketability discounts in connection with the sale or gift of interests in closely held entities (whether those entities hold passive investments or an active trade or business). The regulations would apply to both lifetime transfers and transfers at death.
Florida Fiduciary Access to Digital Assets Act
On July 1, 2016, Florida’s new Fiduciary Access to Digital Assets Act (the “Act”) became effective. The purpose of the Act is to provide direction for fiduciaries (i.e., personal representatives, trustees, guardians, or agents under a durable power of attorney) with respect to accessing another’s digital assets.
Fiduciary access to another’s digital assets became a topic of national interest as Facebook and Yahoo had public battles with family members of deceased loved ones over access to their deceased family member’s account.
Designated representatives – a grantor's best friend?
Estate planning often involves the use of trusts. Trusts may be irrevocable trusts created during your lifetime or upon your death. Florida law imposes the obligation on Trustees of irrevocable trusts to provide “Qualified Beneficiaries” (i.e., beneficiaries who are currently eligible to receive trust distributions and those beneficiaries who would become eligible to receive trust distributions if either the current beneficiary’s interest terminated or the trust terminated) with information concerning the trust and its administration.
The information that the Trustees must provide to the beneficiaries (discussed below) is often voluminous. Recognizing this potential burden, Florida law allows the grantor of a trust to appoint a Designated Representative to receive this information on behalf of the beneficiaries.
Exclusion of stock sale proceeds under Section 1202 of the Internal Revenue Code
Many of our clients have started their own business or received stock in exchange for services. For some clients, Section 1202 of the Internal Revenue Code of 1986, as amended, will provide a way to exclude some or all of the proceeds from the sale or exchange of the stock in the corporation.
For clients who are
(1) eligible taxpayers under Section 1202,
(2) owned stock in a “Qualified Small Business” (“QSB”) as defined by Section 1202,
(3) and acquired the stock within the appropriate timeframe
Congress provided a rare treat when it renewed and permanently extended Section 1202 in the 2015 “extenders bill” (formally titled the Protecting Americans from Tax Hikes Act, or the “PATH Act”) – the ability to recognize substantial appreciation on low-basis assets without any trade-off.
