Finances

Choosing a Trustee

Having a competent trustee is as important to the success of a trust as its being well-drafted. Naming a favored family member as trustee may be neither the smartest nor the kindest thing the grantor can do.

Donor Advised Funds vs. Family Foundations

A Donor Advised Fund (DAF) is one of the fastest-growing options in philanthropy, and there are good reasons why. In fact, DAFs have surged ahead of private Family Foundations in terms of popularity.

Alternative Minimum Tax (AMT)

The Alternative Minimum Tax is a tax meant only for the wealthy, but one that has paralyzed much of the middle class for decades. Fortunately, as of the end of 2012, it has been permanently defanged. Granted, the AMT hasn’t gone away. But this law, which has been modified 19 times since 1969, will need no more patches.

Living Trust (Inter Vivos)

Living Trust (Inter Vivos) – A trust in which the person who establishes it benefits from it during his/her lifetime and, in common usage, is revocable by the donor.
There are no tax advantages to establishing a living trust--nor is there anything automatically charitable involved in such a trust.

Rule of 72

The rule of 72 is a simple calculation of estimating the number of years it will take for a given amount of money to double in value, at a specified rate of interest.

QTIP Trust

WHAT IT IS: A Qualified Terminable Interest Property Trust (QTIP) is a type of Credit Shelter Trust.
WHO IT'S FOR: A QTIP is used by couples who have taxable estates. In function, it's a marital deduction trust that limits the surviving spouse's access to and control of the trust property.

Opportunity Cost

WHAT IT IS: Opportunity cost is a calculation that captures both:
The price paid for an activity or object, and
The value of alternative uses of the time and/or money involved.

Crummey Trust

If someone has created a Crummey Trust you can be quite certain they're doing so in part to limit their estate tax liability.
A Crummey Trust is ideal for parents or grandparents who have some combination of the following factors:

The After-Tax Cost of a Gift

"Do you know how much it will truly cost you to make a gift?" By posing this question to prospective donors, you can raise their interest in the topic of the after-tax cost of a gift. Specifically, how big a charitable deduction will the gift let the donor take?

Capital Gains Basis

Because a significant portion of major giving comes about via the estate planning process, it's to your advantage to understand how and when different tax advantages come into play.

In this case, there's a key difference in the way capital gains are treated if:

Finances

Pages