Planning for Life

Some Biden Tax Proposals I Can Support

Posted by Harry S. Margolis on March 9, 2021

By Harry S. Margolis

Biden-tax-proposals-estate-planning-attorney-Wellesley-MA-02481

Last week, I wrote about the reasons I disagree with President Biden's proposal to eliminate the step-up in basis. Here I'll discuss some other tax proposals he has which I can support.

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Topics: income taxes, capital gains taxes, estate taxes

Life Can Get Complicated, But Don't Fret the Small Stuff

Posted by Harry S. Margolis on January 14, 2021

By Harry S. Margolis

retirement-tax-planning-Medicaid-elder-law-attorney-Wellesley-MA-02481

Congratulations! You've retired. You're free to spend your time as you like. Life should be simple.

But, of course, many parts of it are more complicated. You no longer have health insurance provided by your employer. Instead, you have Medicare and must decide on what Medigap policy and Medicare drug plan to sign up for. And should you save money by joining a Medicare HMO?

And then we come to tax planning. One client recently asked advice on how to minimize taxes given than he has income from the following sources:

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Topics: income taxes, capital gains taxes

What You Need to Know about Special Needs Trusts and Taxes

Posted by Harry S. Margolis on January 22, 2020

By Harry S. Margolis

special-needs-trust-Wellesley-tax

Trusts created for individuals with special needs generally fall into two broad categories: those created with the beneficiary's own funds, often from the proceeds of a personal injury settlement, and those funded by third parties, often by parents and grandparents. The tax treatment of the two trusts is somewhat different.

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Topics: special needs planning, income taxes, Special Needs Trust

Is Your Trust Subject to Massachusetts Income Tax?

Posted by Harry S. Margolis on November 8, 2016

By Harry S. Margolis

Is your trust subject to Massachusetts income taxes? Probably it is. But probably it also pays no income tax so it doesn't matter. I'll explain the reasons why below.

In contrast, the 35 trusts in question in the case of Bank of America, N.A., vs. Commissioner of Revenue (SJC-11995, July 11, 2016), do have to pay income taxes. The Bank of America argued that when it acts as trustee, its trusts should not be subject to Massachusetts income tax because (1) as a corporation it's not a "natural person" and (2) it doesn't have sufficient nexus with Massachusetts to be considered an "inhabitant" of the state for this purpose. The Massachusetts Supreme Judicial Court in this decision disagrees, upholding the decision of the Appellate Tax Board to tax the income of these trusts.

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Topics: trusts, income taxes

5 Rules You Need to Know About the Tax on Capital Gains

Posted by Harry S. Margolis on March 22, 2016

By Harry S. Margolis

There are many types of taxes out there: income, sales, real estate, estate, excise and capital gain. The tax you may be able to avoid or minimize most through planning is the tax on capital gains. Here's what you need to know to do such planning:

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Topics: income taxes, capital gains taxes

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