Discussion:Change in basis for a CRT after date of death?
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| I do not believe it would, but am in a disagreement with colleagues. I cannot find definitive law, examples or anything to further my case. Any ideas? thanks!}} | I do not believe it would, but am in a disagreement with colleagues. I cannot find definitive law, examples or anything to further my case. Any ideas? thanks!}} | ||
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| + | {{ForumReplyPost|UserID=Dennis|Date=28 October 2009|Text=Perhaps I explained this badly the first time. There is no step up for income. Nada. Revaluation of the trust for estate tax purpose does not change an income interest into a capital asset. The taxability of payments from the CRT to the survivor will be no different than if they had been received by the decedent. That is the nature of IRD. If there is a tax due on the value of the income interest there will be a corresponding credit for estate taxes paid. The step up in basis accrues solely to the residual beneficiary which is the charity and therefore meaningless. }} | ||
Revision as of 16:45, 28 October 2009
Discussion Forum Index --> Advanced Tax Questions --> Change in basis for a CRT after date of death?
Discussion Forum Index --> Tax Questions --> Change in basis for a CRT after date of death?
Murphyqu03 (talk|edits) said: | 28 October 2009 |
| This question is in addition to a question I already posted about a week ago. Thank you for everyone that responded-
I have a client that created a CRT. After his death his wife becomes income beneficiary until her death. He died and the entire amount of the CRT was included in his estate because of the annuity payment to my client. My question is - Does the CRT (for purposes of the time between the death of my client and the death of his spouse) receive a step-up in basis of the stock held at date of death due to the inclusion of the value in the estate tax return? I do not believe it would, but am in a disagreement with colleagues. I cannot find definitive law, examples or anything to further my case. Any ideas? thanks! | |
| 28 October 2009 | |
| Perhaps I explained this badly the first time. There is no step up for income. Nada. Revaluation of the trust for estate tax purpose does not change an income interest into a capital asset. The taxability of payments from the CRT to the survivor will be no different than if they had been received by the decedent. That is the nature of IRD. If there is a tax due on the value of the income interest there will be a corresponding credit for estate taxes paid. The step up in basis accrues solely to the residual beneficiary which is the charity and therefore meaningless. | |
