Tax and estate planning update

To our friends who are tax and estate planning professionals,

I hope you're enjoying the summer -- and staying cool and healthy. Here is a list of articles that caught my eye recently. I hope you find them interesting and helpful to your practice as well.

First, a few articles on estate planning...

Estates can now request late portability election relief after 5 years by Paul Bonner, Journal of Accountancy
The IRS issued a revenue procedure (Rev. Proc. 2022-32) Friday that allows estates to elect "portability" of a deceased spousal unused exclusion (DSUE) amount as much as five years after the decedent's date of death.

IRS issues proposed regulations that refine estate and gift tax anti-clawback rule by Joan Holtz, Traci Pumo, Kathy Walter, BDO Insights
The Treasury Department on April 26, 2022, released proposed regulations limiting the anti-clawback rule previously published on November 26, 2019. The proposed regulations – REG-118913-21 – address certain situations in which an estate could be taxed on gifts made by a donor after 2017 and before a reduction in the basic exclusion amount (BEA), wherein the gifts were free of gift tax when made.

Estate planning with personal use real estate by Leslie Bradenham, IPB Tax, Trusts & Estates
The looming threat of a reduction in the lifetime exemption from Federal estate and gift taxes, either due to sunsetting January 1, 2026 or sooner via affirmative legislative action, has resulted in most high-net-worth clients exploring ways to use their entire $12.06 million exemption before it is cut in half. But even for the very wealthy, $12.06 million is a substantial sum with which to part. As a result, many clients have been exploring how to use their exemptions without giving away liquid assets, and real estate is a natural choice. Gifting personal use real estate can be complex and requires careful navigation of estate and gift tax rules, but it can be a good option for some clients.

Now on to planning and other issues surrounding digital assets.

Cryptoasset transactions: State corporate income tax implications by John Yoak, JD, LLM, MBA, Editor: Kevin Anderson, CPA, JD, The Tax Advisor
Many businesses that once considered cryptoassets a highly speculative investment have been won over by the secure, real-time, peer-to-peer nature of cryptoasset transactions and now use cryptoassets as a part of their overall strategy to fund operations and to engage in day-to-day business transactions with customers.

Planning for the future: Estate and tax planning with digital assets by Matt E. Kirk, Holland & Knight
Cryptocurrencies are becoming a larger component of investors' portfolios, especially for millennials and Generation Z, who collectively make up 94 percent of cryptocurrency buyers. This Holland & Knight alert discusses the potential risks and benefits of considering digital assets for estate and tax planning goals.

And some odds and ends topics.

IRS audit rates decreased most for wealthy, GAO finds by Paul Bonner, The Tax Advisor
IRS examinations of individual income tax returns declined between 2010 and 2019 across the board, but the trend was most pronounced for taxpayers with incomes of $200,000 or more, the U.S. Government Accountability Office (GAO) reported Tuesday.

One-third of Americans making $250,000 live paycheck-to-paycheck, survey finds by Alexandre Tanzi, Bloomberg
More than a third of Americans earning at least $250,000 annually say they are living paycheck to paycheck, underscoring how inflation is taking a bigger bite out of Americans’ budgets at all ends of the pay spectrum.

And... finally, if you're in the mood for celebrity gossip, here is an article about the guy who runs Elon Musk's family office.
The only man Elon trusts to look after his $240 billion: Secretive friend who runs Musk's family office controls his wealth -- but also helped him investigate 'pedo guy' and was fired by Merrill Lynch by Harriet Alexander, Daily Mail

We do not provide legal or tax advice. You should consult their own legal or tax advisor. This information is intended for educational purposes, and it is not to be construed as an offer, solicitation, recommendation, or endorsement of any particular security, products, or services.