The Tax Court agreed with Pierre and held that the check-the-box regulations do not "apply to disregard the LLC in determining how a donor must be taxed under the
Federal gift tax provisions on a transfer of an ownership interest in the LLC.
64) Thus, the minor differences between Alaska's DAPT statutes and South Dakota's initial DAPT statutes in their treatment of creditors with tort claims and creditors seeking child support and alimony could likely have been significant in either determining the
federal gift tax consequences to a settlor's transfers to the trust or in determining the federal gross estate of a settlor for federal estate tax purposes.
With regard to lifetime transfers other than a direct skip, an allocation is made on the
federal gift tax return.
In addition to these
federal gift tax changes, there are numerous federal estate tax changes contingent upon when a taxpayer passes away.
Is the
federal gift tax imposed on gifts to charitable organizations?
The tax implications also include state gift tax (only a few states have one) where applicable, which in many instances can be greater than the
federal gift tax, because of the large credit and exemptions currently available under
federal gift tax law.
Although such contributions are considered completed gifts for
federal gift tax purposes, the annual exclusion of $10,000 per year per donee is more than sufficient to cover the annual maximum $500 contribution per donee (designated beneficiary).
Each year, a donor may give $10,000 ($20,000 if a spouse joins the gift) per donee with no
federal gift tax consequences.
There is an exemption to the
federal gift tax for direct payments of tuition.
Recall that one of the objectives of an ING trust is that the transfer to the ING trust be an incomplete gift for
federal gift tax purposes.
