Drafting for Continued Uncertainty: Flexible Gifts in InterActive Legal

Friday, January 29, 2021, 12pm ET/9am PT

Duration: 1hr

Cost: Complimentary for InterActive LegalSuite Subscribers

The uncertainty that drove a significant amount of estate planning at the end of 2020 has carried over into the new year, with many attorneys drafting trusts for clients in an effort to use the relatively high gift and estate tax exemption (now $11.7 million), in case it is reduced by new tax legislation.  Of course, while death and taxes are inevitable, a reduction in the exemption is not a certainty, so we are very much still planning for the unknown.  Clients may be reluctant to make large gifts of property in general, and that reluctance is heightened by the fact that the gifts may not have been necessary to save transfer tax at all, if the exemption is not reduced.  Therefore, many practitioners are contemplating strategies to add flexibility to what are, necessarily, irrevocable transfers.

Some of these strategies have been mentioned on other substantive webinars, and some have been included in InterActive Legal trusts for several years – perhaps as far back as 2012, when we all thought the $5 million transfer tax exemption could be reduced.  In this webinar,  InterActive Legal Content Team Attorneys will examine ways to draft flexible gifts within the drafting system, such as:

-Allowing a disclaimer of property transferred to a trust, with the disclaimed property reverting to the Grantor

-Using a Lifetime QTIP Trust

-Assigning property to a trust based on a formula tied to the transfer tax exemption

-Using a Special Power of Appointment Trust

-Adding a testamentary power of appointment for the grantor’s spouse, in the event the spouse dies young

We’ll review these concepts with a view toward offering tips on drafting documents to implement the substantive planning covered in other webinars.  Audience questions will be answered, if time permits.  Some of the documents discussed are only available in the Wealth Transfer Planning practice system, but subscribers to any system are welcome to attend.

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