Trustees, Cars, and the Tax Tail

Gardner, Randy; Welch, Julie; Conway, Bill
June 2008
Journal of Financial Planning;Jun2008, Vol. 21 Issue 6, p38
Academic Journal
The article focuses on tax benefits that can result in poor investment decisions. It states that the U.S. Supreme Court resolved a conflict among several Circuit Courts of Appeals in the Knight case, which stated that investment advisory fees incurred by a trust were subject to the 2-percent-of-adjusted-gross-income, meaning that a trust's deductions could be partially disallowed. It mentions how family members declared as trustees could not be deducted for taxes, but that the amount paid for taxes wouldn't equal the fees for using a financial institution to administer a small trust. It comments on the U.S. Economic Stimulus Act and a little-mentioned bonus depreciation for new assets purchased in 2009, which would include sports utility vehicles, but that gas costs negate the benefit.


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