This course discusses liens from deferred estate tax on businesses, irrevocable grantor trusts and basis step-ups, and charitable gifts of business interests. Some business owners rely on estate tax deferral for their business interests. Most of them are unaware of automatic secret liens and how the IRS’s need to secure payment of estate tax may interfere with their businesses’ ability to retain and expand loans or fidelity bonds. The IRS recently updated its lien procedures. We will discuss these issues. 

Revenue Ruling 2023-2 confirmed that assets held in an irrevocable grantor trust do not get a basis step-up merely because the deemed owner died. This course will discuss how premature death can cause a sale to an irrevocable grantor trust to cost more than it saves and how a preferred partnership may be an attractive alternative. This course will also discuss a case that radically departed from precedent regarding when a donor will be taxed on a charity’s sale of a donated asset. The case also addressed what constitutes “delivery” of stock. The presenter will discuss planning in light of this case, as well as other issues relating to donating to a business interest.

Learning Objectives: 

• Summarize the Code §6166 qualifications and benefits of deferral 


• Determine how to plan for loss of Code §6166 deferrals when using a sale to an irrevocable grantor trust 


• Outline the description of estate tax liens, their effects, and how to navigate 


• Recognize the lack of basis step-up on the death of the grantor of irrevocable grantor trust 


• State how basis step-up is essential for real estate 


• Define preferred partnership: structure, income, estate tax issues, and planning 


• Identify the assignment of income rule 


• Determine when a transfer of business interest is completed 


• List charitable planning issues unique to business interests