The second day of the Heard at Heckerling Estate Planning Conference started with Turney Berry from Wyatt, Tarrant & Combs, LLP discussing planning for the “middle rich” which he defined as those whose estates would be covered by the lifetime exemption. Care must be taken to maximize the use of the exemption without impacting their quality of life. He discussed techniques including spousal lifetime access trusts (SLATs), grantor retained annuity trusts (GRATs), and intentionally defective grantor trusts (IDGTs). He also focused on the nuances of family inheritance when parents want to maintain control.

The day included a great discussion by Amy M. Kanyuk, Esq. of McDonald & Kanyuk, PLLC about choosing the situs of a trust. Of particular note was the issue we face quite a bit as tax advisors — trusts that get taxed in a state other than the one in which it is located. This can be based upon such things as the domicile of a trustee, a non-contingent beneficiary, or a trust asset. Too often, preparers don’t take into consideration where the beneficiary may reside or don’t warn the grantor that a change in domicile for a trustee or beneficiary may impact the tax status of a trust. We were reminded to take special care when choosing the domicile of a dynasty trust and to use local counsel.

The Honorable Judge Maurice Foley of the U.S. Tax Court gave us many great insights about his time as an attorney for the Legislation and Regulations Division of the IRS and Tax Counsel to the U.S. Senate prior to his appointment to the Court. It was a fascinating look at how tax rules, regulations, and laws come into being and the consideration taken by judges in interpreting them.

The always informative Paul Lee of Northern Trust Corporation, discussed installment obligations between related parties. As accountants, the tax ramifications of these transactions are always front and center. It is so easy to accidentally trigger a gain recognition event if you are not careful!

The informative second day ended with Craig Frankel of Gaslowitz Frankel, LLC discussing various ways to remove a problem trustee, reminding us that if the trust doesn’t include provisions, it may be hard to get relief.

As anyone who has attended the Heard at Heckerling Estate Planning Conference has learned, once the education sessions end, the day is not over. Many of the sponsors of the event hold dinners and networking events. Our group has made some great connections at these events, with attorneys and advisors from all over the country. These important connections can really help us provide the best service for our clients and their families.

Please check back in tomorrow for more on what your Citrin Cooperman team has heard at Heckerling.

• For Day One notes, click here!