Rev. Ruling 2004-64 a boost for estate planning

California CPA, Sept, 2004

In a boon for estate planners, Revenue Ruling 2004-64 looks to bolster the popularity of certain types of trusts, such as intentionally defective irrevocable trusts.

The ruling addresses issues presented with respect to a trust whose grantor is treated as its owner; the gift tax consequences when the grantor pays the income tax attributable to the inclusion of the trust's income in the grantor's taxable income; and the estate tax consequences if, pursuant to the governing instrument or applicable local law, the grantor may or must be reimbursed by the trust for that income tax.

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Look for this issue to be explored in more depth in next month's California CPA.

Access the ruling at www.irs.gov/irb/2004-27_IRB/ar12.html.>

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