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Tag Archive for Kentucky

IRS Approves Extended Retirement Plan Distributions To A Trust

Mark Sommer, Tax Blog, Tax Advisor, Louisville, Kentucky, USA, TaxConnections
Many people want to leave the substantial wealth they have accumulated in retirement accounts in trust for their beneficiaries, rather than having the retirement accounts pass outright to them.  However, the IRS has established extremely complicated rules governing when retirement plan, IRA and Section 403(b) annuity contracts payable to a trust can be distributed over the life expectancy of one of the trust beneficiaries, rather than under the general five year distribution time limit.

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Florida Trustee’s Failure To File Trust Accountings And Tax Returns Results In Trust Freeze

Mark Sommer, Tax Advisor, Tax Blog, Louisville, Kentucky, USA, TaxConnections

In a recent Florida Appeals decision, Landau v. Landau, a trustee who failed to file proper and complete trust accountings for two years, and to file trust income tax returns for the same two years, was hit with a freeze of the trust assets by the Court. Because the trustee was also the lifetime income beneficiary of the trust, this freeze effectually prevented the trustee from using the trust for his own support.

Florida trust law requires that a trustee file annual trust accountings. This is true whether the trustee is a bank or trust company, or, as here, was the surviving spouse of the decedent who had created the trust for his lifetime benefit.
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Kentucky Department of Revenue – Secrets Revealed

Many states, like my home state of Florida, have broad freedom of information laws. Known in Florida as the Sunshine Laws, the state’s citizens can request a wide range of information from the government. Under the laws, so long as the information is not made confidential by a specific statute/law, then the government has an obligation to provide the citizen with whatever is requested. As a state and local tax (“SALT”) practitioner, I often use this knowledge to my advantage. I often request documents and statistics from the state that I find beneficial to myself, my client, or my practice.

Other states have similar laws. In Kentucky, the Open Records Act gives its citizens a mechanism to request a broad spectrum of information from its government. Like many state agencies believe, the Kentucky Department of Revenue thought it was above the law. Read more

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