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The Internal Revenue Service recently released a Private Letter Ruling (PLR) approving the transfer of a portion of an inherited IRA into a new IRA that would benefit a special needs trust. This PLR echoes a previous private letter ruling that approved a similar transaction.
The request for a ruling was submitted on behalf of X, a person with disabilities who is eligible to receive public benefits. X and his siblings were named as the designated beneficiaries of their father's two IRAs. Since X's ownership of his share of the inherited IRAs could affect his access to benefits, he requested the IRS's permission to transfer his share of the two IRAs into a newly established IRA that would benefit a first-party special needs trust designed to supplement his other sources of income. (Normally, the transfer of an inherited IRA into a new IRA would create an income tax liability as a transfer of Income in Respect of a Decedent.) Upon X's death, the funds in the trust would be used to reimburse the government for medical assistance, and the remaining funds, if any, would pass to X's children or his siblings.
In PLR 201116005, the IRS allows the transfer of the share into a new IRA that would benefit X's special needs trust. In the ruling, the IRS explains that "[b]ased solely on the facts and representations submitted, we conclude that Trust will be treated as owned by X under 671 and 677(a) [of the Internal Revenue Code]. Therefore, assuming the transfer of X's share of the IRAs to the Trust is not a gift by X, such transfer will not be a sale or disposition for federal income tax purposes or a transfer for purposes of 691(a)(2)."
To read the full PLR, which does not have any precedential value, click here.
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The U.S. District Court for the Northern District of Texas granted a plaintiffs' motion for summary judgment and vacated the minimum staffing standards for nursing homes participating in Medicare or Medicaid in a final rule that had been issued by the...
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PLR Allows Naming SNT As IRA Beneficiary
The Internal Revenue Service recently released a Private Letter Ruling (PLR) approving the transfer of a portion of an inherited IRA into a new IRA that would benefit a special needs trust. This PLR echoes a previous private letter ruling that approved a similar transaction.
The request for a ruling was submitted on behalf of X, a person with disabilities who is eligible to receive public benefits. X and his siblings were named as the designated beneficiaries of their father's two IRAs. Since X's ownership of his share of the inherited IRAs could affect his access to benefits, he requested the IRS's permission to transfer his share of the two IRAs into a newly established IRA that would benefit a first-party special needs trust designed to supplement his other sources of income. (Normally, the transfer of an inherited IRA into a new IRA would create an income tax liability as a transfer of Income in Respect of a Decedent.) Upon X's death, the funds in the trust would be used to reimburse the government for medical assistance, and the remaining funds, if any, would pass to X's children or his siblings.
In PLR 201116005, the IRS allows the transfer of the share into a new IRA that would benefit X's special needs trust. In the ruling, the IRS explains that "[b]ased solely on the facts and representations submitted, we conclude that Trust will be treated as owned by X under 671 and 677(a) [of the Internal Revenue Code]. Therefore, assuming the transfer of X's share of the IRAs to the Trust is not a gift by X, such transfer will not be a sale or disposition for federal income tax purposes or a transfer for purposes of 691(a)(2)."
To read the full PLR, which does not have any precedential value, click here.
<p>The Internal Revenue Service recently released a Private Letter Ruling (PLR) approving the transfer of a portion of an inherited IRA into a new IRA that would benefit a special needs trust. This PLR echoes a <a href="https://attorney.elderlawanswers.com/irs-plr--beneficiarys-transfer-of-share-of-ira-to-trust-is-not-a-transfer-for-income-tax-purposes-13155">previous private letter ruling</a> that approved a similar transaction.</p><p>The request for a ruling was submitted on behalf of X, a person with disabilities who is eligible to receive public benefits. X and his siblings were named as the designated beneficiaries of their father's two IRAs. Since X's ownership of his share of the inherited IRAs could affect his access to benefits, he requested the IRS's permission to transfer his share of the two IRAs into a newly established IRA that would benefit a first-party special needs trust designed to supplement his other sources of income. (Normally, the transfer of an inherited IRA into a new IRA would create an income tax liability as a transfer of Income in Respect of a Decedent.) Upon X's death, the funds in the trust would be used to reimburse the government for medical assistance, and the remaining funds, if any, would pass to X's children or his siblings.</p><p> In PLR 201116005, the IRS allows the transfer of the share into a new IRA that would benefit X's special needs trust. In the ruling, the IRS explains that "[b]ased solely on the facts and representations submitted, we conclude that Trust will be treated as owned by X under 671 and 677(a) [of the Internal Revenue Code]. Therefore, assuming the transfer of X's share of the IRAs to the Trust is not a gift by X, such transfer will not be a sale or disposition for federal income tax purposes or a transfer for purposes of 691(a)(2)."</p><p>To read the full PLR, which does not have any precedential value, click <a target=_blank href="https://www.irs.gov/pub/irs-wd/1116005.pdf ">here</a>. </p><p><i>Special thanks to ASNP members <a href="https://www.specialneedsplanners.com/content/FirmProfile.asp?FirmID=5102#NancyChudacoff">Nancy Fisher Chudacoff</a> and <a href="https://www.specialneedsplanners.com/content/FirmProfile.asp?FirmID=5293#KevinUrbatsch">Kevin Urbatsch</a> for providing us with this PLR</i>. </p>
End User License Agreement (EULA)
Internet Listing Agreement
This Internet Listing Agreement (the "Agreement") is made by and between WealthCounsel, LLC,
with offices
located at 3 2nd Street, Ste. #501, Jersey City, New Jersey, USA, 07302, a Nevada limited
liability company
(the "Company") and the subscribing law firm (the "Firm"). The term "Firm" includes each
individual attorney
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The Company agrees to insert Information (as defined below) about the Firm in the Company's
Website located
at http://www.elderlawanswers.com or www.specialneedsanswers.com or both (the "Website"),
provided that the
Company reserves the right not to list any and all Information that it deems, in its sole
discretion,
inappropriate, offensive or detrimental to the operation of the Company's business. Listing the
Information
on the Website neither includes submission of the Website or Web Page to Internet search engines
nor
guarantees that the Web Page will be included or ranked in a particular order in the search
results of any
or all Internet search engines.
"Information" in this Agreement means all information provided by or on behalf of the Firm to
the Company in
electronic format only.
"Web Page" in this Agreement means the Information, together with any accompanying graphic or
design
elements, as inserted in the Company's Website. The Company is not responsible for any errors or
omissions
in the Web Page. The Company is not responsible for any errors or omissions in the Template. It
is the
exclusive obligation of the Firm to ensure that the Web Page is free of errors and omissions.
Content License
The Company hereby grants to the Firm permission for the limited use of republishing, in print
or electronic
format, all articles or text ("the Content") authored by the Company specifically for the
product(s) to
which the Firm subscribes (for purposes of clarity, this refers to either ElderLawAnswers or
Academy of
Special Needs Planners), provided that (a) the Firm's subscription with the Company has not
expired or been
deactivated for non-payment, or breach of agreement as stated herein and (b) the Firm does not
re-sell the
Content or (c) use the Content for any other purpose than to promote the Firm; (d) the Firm does
not use the
Content to promote any ancillary business to the firm. The Company retains all copyrights and
ownership of
the Content entitled by law, implied or otherwise and reserves the right to terminate this
Content License
as stated herein, at any time.
Term
The Information will be listed for a period of one (1) year ("Term", which shall include each
renewal term)
beginning on the date of registration by the Firm. On each one (1) year anniversary of this date
(each a
"Renewal Date"), this Agreement will be automatically renewed for an additional twelve (12)
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unless the Firm cancels subscription within 30 days of the initial date of registration by
electronic or
paper submission. The Firm understands that subsequent subscription renewal is automatic unless
the Firm
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subscription).
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The Firm represents and warrants that:
1. The Firm listed on the Web Page (a) has at least three (3) years of experience practicing
elder law as a
principal area of practice, or (b) can demonstrate an equivalent of experience in elder law by
way of
on-going education, training or other practical experience deemed acceptable to the Company;
2. The Firm is entitled to post the legal services described in the Information on the Web
Page;
3. Each attorney listed on the Web Page is duly licensed and qualified to practice law in the
state in which
he or she is listed;
4. Each attorney listed on the Web Page is in good standing in all states in which such attorney
is licensed
and qualified to practice law;
5. Each attorney listed on the Web Page is covered by malpractice insurance for performing the
legal services
described on the Web Page under the name of such attorney, with limits of at least $100,000 per
claim and
$300,000 in the aggregate, issued by a nationally recognized and reputable insurance
company;
6. The Information (a) does not infringe or violate the rights, including intellectual property
rights and
any right of privacy or publicity, of any third party, (b) is neither defamatory nor obscene,
and (c) is
true and correct in all respects;
7. This Agreement is a legal and valid obligation binding on the Firm and enforceable on its
terms, the
execution, delivery and performance of which does not conflict with any other agreement,
instrument or
understanding, oral or written, to which the Firm is a party or by which it is bound, nor
violate any law,
rule or regulation applicable to the Firm; and
8. The person executing this Agreement on behalf of the Firm is a partner or owner of the Firm,
duly
authorized to execute this Agreement on behalf of the Firm.
Subscribers of the Academy of Special Needs Planners (ASNP) who are not law firms further
warrant:
1. That each financial planner listed on the Web Page is a qualified as a CFP, CLU, ChFC or
Chartered Special
Needs Consultant; and
2. That every trust administrator listed on the Web Page has been recommended by an ASNP
subscriber who is
not also a member of that trust administrator’s company.
Covenants
The Firm undertakes covenants and agrees to take each of the following actions, and if the Firm
is not an
individual, to ensure that each attorney listed on the Web Page takes such action:
1. to comply with all laws, rules and regulations applicable to it, him or her in each state and
jurisdiction
in which he or she is licensed and qualified to practice law;
2. to use the Website and the Web Page in compliance with U.S. law and any other applicable laws,
rules and
regulations;
3. not to use the Website or the Web Page for any illegal purposes;
4. not to interfere with the Website, the Company's other subscribers and their web pages on the
Website, and
any other services the Company may provide, directly or indirectly, to the public or its
subscribers;
and
5. to keep the Information current and updated on at least a monthly basis during the term of
this Agreement,
and to correct any errors and omissions therein within twenty-four (24) hours of becoming aware
or being
notified of them.
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In addition to any other rights and remedies at law or in equity, the Company reserves the right
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terminate this Agreement and remove the Web Page without prior notice (a) if payment of the
Listing Fee is
Past Due; (b) if the Firm breaches any term or condition of this Agreement, provided, the
Company shall use
commercially reasonable efforts to notify the Firm of such removal and termination and in the
case of a
breach under clause (b), the Firm shall have fifteen (15) days from the date of such notice to
cure the
breach; and (c) if the Company determines based on feedback from consumers that the Firm or any
of its
listed attorneys does not meet the standard of practice desired of subscribers of the Website.
"Past Due"
means the annual Listing Fee (paid once a year or in 12 equal installments, once a month) is not
received by
the Company on or before the 30th day from which the payment is due. If a breach is cured to the
satisfaction of the Company, in its sole discretion, the Company shall re list the Web Page and
restore any
suspended service in accordance with the terms of this Agreement. In case of a permanent removal
of the Web
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Fees
theretofore paid for the remainder of the current Term on a prorated basis. Other than as stated
in the
immediately preceding sentence, the Company does not give any refunds.
Provision of Services
The Company intends, but does not guarantee, that the Web Page will be operational 24 hours per
day, 7 days
per week, 365 days per year. The Website and Web Page may not be hosted on the Company's own
servers, and
the Company depends on a hosting service provider to keep the Website and Web Page operational.
Notwithstanding anything to the contrary in this Agreement, the Company's obligation to keep the
Website and
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provided to the
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Company's or
its hosting service provider's web servers ("Interruptions") that last twenty-four (24)
continuous hours or
less will not be compensated. Interruptions that last more than twenty-four (24) continuous
hours will
result in an extension of the Term of this Agreement equal to the duration of the Interruption
(the
"Extension of Service") not to exceed 30 (thirty) days. AN EXTENSION OF SERVICE IS THE FIRM'S
SOLE REMEDY
FOR AN INTERRUPTION IN SERVICE, AT LAW AND IN EQUITY.
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Any and all information provided by or collected from visitors of the Website and the Web Page
(the "User
Information") shall be owned solely by the Company, except that the User Information which is
part of the
text of an e-mail communication initiated on the Website or the Web Page, shall be treated as
confidential
and as protected by the attorney-client privilege between the user who initiated the e-mail and
the Firm or
attorney to whom it is addressed (the "Confidential Information"). User Information that would
otherwise be
deemed to be Confidential Information shall not qualify as Confidential Information if it is
also provided
to or collected by the Company in a manner other than as indicated above. The Company will
neither collect,
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No Warranties
THE COMPANY DOES NOT MAKE ANY REPRESENTATIONS OR WARRANTIES, AND HEREBY EXPRESSLY DISCLAIMS ALL
WARRANTIES
OF ANY KIND AS TO ANY ASPECT OF THE WEBSITE, THE WEB PAGE, THE INFORMATION THEREIN AND ANY
SERVICES PROVIDED
UNDER THIS AGREEMENT, INCLUDING THE WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
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UNINTERRUPTED, ERROR FREE OR COMPLETELY SECURE, AND WILL NOT BE LIABLE FOR THE CONSEQUENCES OF
ANY
INTERRUPTIONS, ERRORS OR BREACHES IN SECURITY. IN ADDITION, THE COMPANY SPECIFICALLY DISCLAIMS
ANY
REPRESENTATIONS AND WARRANTIES WITH RESPECT TO ANY SERVICES OR PRODUCTS OFFERED OR SOLD THROUGH
THE WEBSITE.
Limitation Of Liability
IN NO EVENT WILL THE COMPANY BE LIABLE TO THE FIRM FOR LOSS OF PROFITS, LOSS OF REVENUES, LOSS
OF SAVINGS,
LOSS OF USE, LOSS OR CORRUPTION OF CONTENT, DATA OR INFORMATION OR ANY INDIRECT, INCIDENTAL,
SPECIAL,
EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES, WHETHER UNDER TORT, CONTRACT OR OTHER THEORIES OF
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THIS AGREEMENT
EXCEED THE AMOUNT PAID BY THE FIRM TO THE COMPANY UNDER THIS AGREEMENT FOR THE TWELVE (12) MONTH
PERIOD
IMMEDIATELY PRECEDING THE EVENT GIVING RISE TO THE CLAIM OF LIABILITY.
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Each party will indemnify, defend and hold the other party harmless from and against any and all
costs,
liabilities, losses, damages and expenses, including reasonable attorney's fees, and amounts
paid in
settlement, resulting from or arising out of any claim, suit, action or proceeding brought
against the other
party as a consequence of the indemnifying party's infringement of any intellectual property
right of a
third party, including without limitation, any third party patent, copyright, trademark or trade
secret.
This indemnification is subject to the parties' limitation of liability under this Agreement.
Governing Law
This Agreement shall be governed by and construed in accordance with the laws of the State of
New Jersey and
shall be deemed to have been executed in Jersey City, New Jersey. Any legal action arising from
or related
to this Agreement shall be brought in any state or federal court located in the State of New
Jersey, County
of Hudson, and the parties hereby consent to the jurisdiction of such courts.
Entire Agreement
This Agreement is the entire Agreement between the parties with respect to the subject matter
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Arbitration
Any disputes that arise between the parties with respect to the performance of this Agreement
shall be
submitted to binding arbitration in the State of New Jersey, County of Hudson by the American
Arbitration
Association, to be determined and resolved by said Association under its rules and procedures in
effect at
the time of submission and the judgment upon the award be entered in any court having
jurisdiction thereof.
The parties hereby agree to share equally in the costs of said arbitration except that in the
discretion of
the arbitrator, any award may include the cost of the party's counsel if the arbitrator
expressly determines
that the party against whom the award is entered has caused the dispute, controversy or claim to
be
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Should any term, warrant, covenant, condition, or provision of this Agreement be held to be
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This Agreement is valid and enforceable against the Firm. Payment by the Firm to the Company, by
check or
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