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50 Real Prop. Tr. & Est. L.J. 1 (2015-2016)

handle is hein.journals/rpptj50 and id is 1 raw text is: PRESERVING INHERITED EXCLUSION AMOUNTS: THE NEW PLANNING FRONTIER Austin W. Bramwell* & Leah Socash** Editor's Synopsis: Portability has forced estate planners to reconsider how they plan for married couples. But the impact of these rules stretches beyond married couples to affect surviving spouses who choose to remarry. In essence, these rules have created a whole new area of planning deceased spousal unused exclusion preservation planning that did not previously exist. This Article examines this new field in detail and the advantages and disadvantages of its various techniques. I. INTRODUCTION ......................................... 2 II. PORTABILITY OVERVIEW ............ .................2 III. ADVANTAGES OF PORTABILITY...........................4 IV. RISK OF DSUE FORFEITURE ...........9 V. BASIC STRATEGIES FOR PRESERVING INHERITED EXCLUSION 1........... 1 A. Credit Shelter Trust to Preserve DSUE ... .................. 12 B. Locking in DSUE via Lifetime Taxable Gifts ........................14 C. DSUE Lock-In of Relatively Small Amounts of DSUE ........16 D. Perceived Downsides of Making Taxable Gifts .................. 17 E. Taxable Gifts Included in the Gross Estate . .............. 19 VI. THE VIRTUALLY REVOCABLE TRUST .. ..... ............21 VII. TRIGGERING SECTION 2519............ .................24 A. Section 2519 Transfers: Triggering Gross Estate Inclusion ...26 B. Section 2519 Transfers that Escape Gross Estate Inclusion... 30 C. Fine-Tuning the QTIP Gift..........................32 VIII. GIFT BY PROMISE .............................33 IX. INTENTIONALLY NON-2701-COMPLIANT PREFERRED PARTNERSHIP .....................36 X. CONCLUSION................. .....................39 Austin Bramwell is a partner in the Trusts & Estates group of Milbank, Tweed, Hadley & McCloy LLP and an Adjunct Professor of Law at New York University School of Law. Leah Socash is an associate in the Trusts & Estates group of Milbank, Tweed, Hadley & McCloy LLP.

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