BarbriSFCourseDetails
  1. keyboard_arrow_leftBack

Course Details

Course Information
  • smart_display Format

    On-Demand

  • signal_cellular_alt Difficulty Level

    Intermediate

  • work Practice Area

    Estate Planning

Date & Time
  • event Date

    Thursday, April 17, 2025

  • schedule Time

    1:00 p.m. ET./10:00 a.m. PT

  • timer Program Length

    90 minutes

Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.

$297.00

This CLE/CPE course will provide estate planning counsel with a thorough and practical guide to converting grantor trusts to non-grantor trusts and evaluating the potential tax benefits and disadvantages of such conversion. With the current environment's continued focus on income tax planning in conjunction with estate tax planning, the panel will cover methods of changing the tax classification from grantor to non-grantor and the issues and effects of this change. The webinar will also consider the risks stemming from conversion, the potential disadvantages of non-grantor trusts, and the risks associated with reverting to grantor trust status in the future in certain scenarios.

Faculty

Cynthia D. Brittain
Partner
Holland & Knight LLP

Ms. Brittain is a private wealth services attorney in Holland & Knight's Century City and Newport Beach offices. She works closely with private clients in the U.S. and around the world, designing efficient strategies that maximize tax benefits for individuals and their companies while meeting personal wealth transfer and business succession needs. Ms. Brittain has decades of experience advising high-net-worth and ultra-high-net-worth individuals and families on domestic and international income and estate tax planning strategies and philanthropic endeavors. Her practice offers significant cross-border experience for families whose members are multinational and whose companies have a global footprint. Ms. Brittain helps clients navigate complex issues relevant to international and domestic wealth and asset transfers. She also assists with pre-immigration planning and international corporate tax matters, leveraging her extensive experience with the cross-border regulatory laws that affect planning and compliance. Ms. Brittain is frequently sought out by international private clients and their advisory teams in urgent, high-stakes situations to help mitigate legal and reputational risk.

expand_circle_down Expand to View Full Bio expand_circle_up Collapse Bio
Shudan Zhou
Partner
Norton Rose Fulbright, LLP

Ms. Zhou focuses her practice on counseling high net worth individuals, trustees, and financial institutions on the US tax implications of wealth transfer strategies, with an emphasis on international income and estate tax planning. She has substantial experience advising clients on all aspects of FATCA and CRS as well as various withholding tax and disclosure regimes. Ms. Zhou frequently counsels clients on the US tax consequences of expatriation from and immigration to the United States, and of US inbound and outbound investment structures. She also advises on the creation, administration and governance of offshore trust structures.

expand_circle_down Expand to View Full Bio expand_circle_up Collapse Bio

Description

Under current tax law, individuals with grantor trusts that have been settled to minimize estate tax exposure may be better served with non-grantor trusts after considering the income tax implications. Converting grantor trusts to non-grantor trusts may also create additional income tax deductions in connection with state income taxes, charitable planning, and the pass-through business income rules.

For higher net worth taxpayers, the loss of these and other deductions often hits much harder than the potential estate tax risk, increasing the federal and state income tax burden on many income-generating assets. Grantor trusts, long the preferred vehicle for settlors looking to minimize or defer wealth transfer taxes, may be less impactful in this lens. However, in some cases, these tax benefits available to non-grantor trusts may come at the expense of certain long-term transfer and income tax benefits available to grantor trusts.

Planners should consider restructuring existing grantor trust vehicles to convert trusts to non-grantor trusts if they determine that the overall tax benefits outweigh potential tax disadvantages when both short-term and long-term planning goals are taken into account.

Listen as our experienced panel provides a practical guide to converting grantor trusts to non-grantor trusts and, to the extent not already done, using up the temporarily increased estate exemption amounts.

Outline

  1. Converting grantor trusts to non-grantor trusts
    • Methods for the conversion
    • Potential pitfalls and tax implications
  2. Potential benefits of non-grantor trusts
    • Federal and/or state income tax savings and deduction benefits
    • Cross-border scenarios
    • Other potential tax benefits
    • Incomplete gift non-grantor trusts
  3. Potential disadvantages of non-grantor trusts
    • Weighing long-term disadvantages against short-term benefits (impact on basis planning, loss of certain transfer tax benefits and planning opportunities, etc.)
    • Cross-border scenarios
  4. Conversion back to grantor trust
    • Current status of authorities
    • Potential risks

Benefits

The panel will review these and other relevant topics:

  • Switching off grantor trust status of existing trusts
  • State income tax benefits and treatment of non-grantor trusts
  • Possibility for enhanced deductions
  • Tax impact of complete gift trusts vs. incomplete gift trusts
  • Potential benefits when dealing with Qualified Small Business Stock
  • Potential income and transfer tax disadvantages of non-grantor trusts
  • Using incomplete gift non-grantor trusts (INGs) to minimize state income tax