Abstract

Tax planning does not cease with the decedents death. Professional advisors are in a position to make certain decisions which can affect not only the estate tax return but the decedent's final return, the income tax returns of the fiduciary, and the income tax returns of beneficiaries for years to come. Through use of some of the techniques described in this article, the basic tax objective of postmortem tax planning-overall tax minimization for all parties concerned with the estate-may be achieved. After some general considerations, this article will deal with matters affecting, in turn, the decedents final return, the estate tax return, and the fiduciary returns.

The basic tool of the tax advisor is knowledge—knowledge of the estate, the income of the fiduciary, the income tax brackets of the beneficiaries, and the cash needs of all parties. No advisor can minimize the human element of estate administration. In such periods, the emotional and personal problems of the beneficiaries must be considered. Great care must be taken in presenting alternative courses of action. Proposals which may have significant tax benefits may be rejected merely because of the emotional reactions of the heirs.

How to Cite