Tax Planning for Retirees

Estate and Gift Taxes on Retirement Benefits

  • § 20.01 Overview of Estate and Gift Taxes on Retirement Benefits
  • —–[1] Gift Tax on Beneficiary Designation
  • —–[2] Estate Tax on Retirement Benefits
  • —–[3] Estate Tax Marital Deduction
  • —–[4] Estate Tax Charitable Deduction
  • —–[5] Estate Tax Exclusion for Pre-1985 Retirement Benefits
  • —–[6] Tax Planning with Qualified Disclaimers
  • —–[7] Income Tax Deduction for Federal Estate Taxes Paid
  • § 20.02 Gift Tax on Beneficiary Designation
  • —–[1] Retiree Unlikely to Incur Gift Taxes on Retirement Benefits
  • —–[2] Marital Deduction for Irrevocable Gifts to Spouse
  • —–[3] The $5,000,000 Lifetime Exclusion
  • § 20.03 Estate Tax Treatment of Retirement Benefits
  • —–[1] Taxable Estate and Effect of the Applicable Exclusion
  • ———-[a] The Tax Rate and Exclusion Amount
  • ———-[b] Deceased Spouse Unused Exclusion Amount
  • ———-[c] Election of Carryover Basis for 2010 in Lieu of Estate Tax
  • ———-[d] Applicability to Retirement Benefits
  • —–[2] The Marital Deduction
  • ———-[a] Marital Deduction for a Retirement Plan or Arrangement
  • ———-[b] Recipient Trust Subject to Spouse’s General Power of Appointment
  • ———-[c] QTIP Election for a Plan, Arrangement, or Beneficiary Trust
  • —————[i] Advantages Afforded by a QTIP Election
  • —————[ii] QTIP Election for a Retirement Plan or Arrangement
  • —————[iii] QTIP Election for a Trust that Is Beneficiary of a Plan or Arrangement
  • —————[iv] Control of Beneficiary Selection vs. Reduced Tax Deferral
  • —————[v] Accumulations of Required Minimum Distributions in Trust
  • —————[vi] Spousal Power over IRA Income Not Exercised
  • —————[vii] Automatic QTIP Election for Spousal Survivor Annuities
  • —————[viii] Effect of QTIP Election on Surviving Spouse’s Gross Estate
  • ———-[d] Qualified Domestic Trust (QDOT) for Non-Citizen Surviving Spouse
  • —————[i]  Generally No Marital Deduction for Non-Citizen Spouse Without a QDOT
  • —————[ii] Special QDOT Treatment for IRAs, Non-Assignable Annuities, Retirement Plans
  • —–[3] Exempt Charitable Organization as a Plan Beneficiary
  • —–[4] Exclusion Dependent on Certain Pre-1985 Events
  • —–[5] Disclaimers of Interests in Retirement Plans and Arrangements
  • ———-[a] The General Effect of Qualified Disclaimers of Interests
  • ———-[b] Definition of a Qualified Disclaimer
  • ———-[c] The Nine-Month Disclaimer Window
  • ———-[d] No Acceptance of Benefits in the Retirement Plan or Arrangement
  • ———-[e] Automatic Passage of Disclaimed Interest to Successor
  • ———-[f] Disclaimers of Interests by Executors and Administrators
  • ———-[g] Disclaimers of Partial Interests in Plans or Arrangements
  • —————[i]  Disclaimers of Separate Interests
  • —————[ii] Disclaimers of Powers of Appointment
  • —————[iii] Disclaimers of Trust Interests
  • —————[iv] Disclaimers of Severable Property
  • —————[v] Disclaimers of Undivided Portions
  • —————[vi] Disclaimers of Pecuniary Amounts
  • ———-[h] Tax Planning with Disclaimers
  • —–[6] Effective Use of the Applicable Exclusion
  • ———-[a] Portability of the Applicable Exclusion
  • ———-[b] Traditional Planning May Still be Useful
  • ———-[c] By-Pass Trust as Beneficiary of a Tax-Favored Retirement Plan
  • —————[i] Use of By-Pass Trusts Generally
  • —————[ii] By-Pass Trusts and IRAs in Community Property States
  • § 20.04 Income Tax Deductions for Estate Tax Paid
  • —–[1] Estate Tax Paid on Income in Respect of a Decedent (IRD)
  • —–[2] Retirement and Annuity Payments as IRD
  • —–[3] Computation of Income Tax Deduction for Portion of Estate Tax Liability
  • § 20.05 The Generation-Skipping Tax (GST)

» Chapter 21 – RETIREMENT BENEFITS OF FOREIGN RETIREES