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tax question for diane k.

Discussion in 'Asset Protection/Taxes/Legal' started by dino23, Nov 28, 2007.

  1. dino23
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    dino23 New Contributor

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    diane,

    lets say i gained a large lump some of money (lets say 20 million) from a vehicle (stocks, sale of a business, however...). i paid the taxes on that money. then i choose to put a large portion of it in to a trust for a friend. how would the friend (trustee) be taxed on the money placed into his trust? im sure it's not the same taxiation as if i gave it to him out right, or is it? would he get the tax breaks on the money that a trust is eligible for? thanks for your time!

    :thankyousign:
     
  2. Diane Kennedy
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    Diane Kennedy Bronze Contributor

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    Generally, I avoid "what if" questions like the plague because you can drive yourself crazy figuring out what if scenarios. But, I have an easy answer to this one, so I'll give it "It depends."

    Here are some of the issues: - Friend is the trustee, you are the trustor, but who is the beneficiary? What type of trust: complex, simple, revocable, irrevocable?

    A better way to approach this is figure out what you want to achieve...and without getting to personal, is this just a hypothetical exercise or does someone you know have a bunch of money and facing a real situation? If it's the later, then they need to talk to an estate attorney/CPA to get detailed information for their goals.
     
  3. dino23
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    dino23 New Contributor

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    thanks for your response diane! will do!
     

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