Neil Carbone Quoted in MarketWatch on Estate Planning for Estate Tax, Capital Gains, and Trust Flexibility

Estate planning isn’t always straightforward, especially when it comes to balancing estate tax, capital gains, and trust flexibility. In a recent MarketWatch article, Neil V. Carbone shares his insight on how certain trust provisions can offer flexibility for high-net-worth individuals to optimize tax outcomes and protect family wealth across generations.

From the article:

And now for the potential spanner in the works: In order to change your mind, you, as the donor, will have to review the terms of the trust, according to Neil V. Carbone, trusts and estates partner at New York law firm Farrell Fritz PC. Many dynasty trusts are set up to be “intentionally defective grantor trusts.”

“One way to make a trust ‘defective’ for income-tax purposes is to include a power to swap assets out of the trust by substituting into the trust other assets of equivalent value,” he says. “Such a swap power will allow the donor to swap out low-basis property from the trust and to replace it with high-basis assets.”

Read the article here:

‘I’m in the home stretch’: I’m 80. Do I leave my kids a ‘Magnificent Seven’ dynasty trust or a brokerage account? – MarketWatch