Bob Keebler Explains How a Footnote Can Cost Thousands

A footnote in the Joint Committee on Taxation's Blue Book may create significant tax consequences for trusts and estates beginning in 2026.

In this episode, Bob Keebler joins Cary Sinnett to explain why Footnote 102 has raised concerns about applying the new 2/37ths limitation to distributable net income, charitable deductions and other trust and estate deductions. They explore how the limitation could create phantom income and affect charitable planning, inherited IRAs, Roth conversions, fiscal-year elections and trusts with multiple levels of distribution.

What you'll learn

Why Footnote 102 is generating so much discussion among trust and estate professionals.  How the new limitation could create unexpected tax consequences.  What it may mean for charitable giving, inherited IRAs and beneficiary planning.  Why fiscal-year elections could become more valuable.  How the rules could affect Roth conversion and trust planning strategies.  Why planners should prepare clients for multiple possible outcomes. Bob Keebler also explains why practitioners should carefully communicate the current uncertainty, review beneficiary and charitable planning strategies, and evaluate potential outcomes before making recommendations.

PFP Resources:

Archive: Understanding the Estate of Grace and its Progeny

Resource: Generation Skipping Transfer Tax Chart

Podcast: Jeff Levine on the Planning Tug-of-War: Income vs. Estate

Resource: Useful Estate and Trust Decision Charts

This episode is brought to you by the AICPA's Personal Financial Planning Section, the premier provider of information, tools, advocacy, and guidance for professionals who specialize in providing tax, estate, retirement, risk management and investment planning advice. Also, by the CPA/PFS credential program, which allows CPAs to demonstrate competence and confidence in providing these services to their clients. Visit us online to join our community, gain access to valuable member-only benefits or learn about our PFP certificate program.

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