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March 03, 2011 at 10:07 AM
This is the fourth in a series of 23 tax tips that AdvisorOne will publish on each business day in March as part of our Tax Planning Special Report (see our Special Report calendar for a more complete list of topics to be covered and experts who will deliver their insights).
Today’s tax tip comes from Martin Shenkman of Shenkman Law, with legal offices in northern New Jersey and New York. Shenkman is the author of 34 books, hundreds of magazine and journal articles, and received his undergraduate education from the Wharton School of the University of Pennsylvania, his MBA from the University of Michigan and his JD from Fordham University.
The Tip: Have the Grantor Pay Taxes on a Grantor Trust’s Income.
Shen
kman (left) points out that grantor trusts can be structured so that the grantor, the individual setting up the trust, can be taxed on the trust income. Counterintuitive? Perhaps, but only if you disregard the estate tax benefit to the grantor.
