Live from Heckerling: 2023 Estate and Tax Planning Developments

The Heckerling Institute on Estate Planning in Orlando has just begun, and the sessions kicked off with a review of recent updates. On Monday, Jan. 8, Turney P. Berry, Ronald D. Aucutt and Carlyn S. McCaffrey gave a panel discussion in which they analyzed the significant tax and non-tax developments of 2023. The panel also shared their thoughts as to what may lie ahead for 2024.

Legislation and Notable Cases

While other presenters will be speaking in detail about the Corporate Transparency Act, the panel highlighted its key disclosure requirements, compliance ramifications and impact.

On the caselaw front, valuation was top of mind for many federal courts, and Connelly v. United States was one of the most notable cases from last year. The U.S. Supreme Court, which granted certiorari in Connelly in December, is now going to weigh in on this U.S. Court of Appeals for the Eighth Circuit’s decision regarding the estate tax impact of life insurance proceeds taken out by a closely held corporation on a shareholder.

The panelists also discussed the U.S. Tax Court’s February decision of Estate of Cecil, in which the Tax Court addressed tax-affecting issues in the context of the famous family-owned Biltmore Hotel. And, they also shared their thoughts on Schlapfer v. Comm’r, the Tax Court case decided in May that gave the taxpayer a huge victory on the adequate disclosure front.

Rounding out the discussion, Turney, Ron and Carlyn shared their thoughts on United States v. Paulson, a case with complicated facts that poses interesting, yet troubling, questions. In Paulson, the Ninth Circuit held in favor of the Internal Revenue Service, ruling that successor trustees take on the liability of their predecessors for unpaid taxes.

Charitable Giving Arena

We also heard about Hoensheid v. Comm’r, the Tax Court’s March decision involving the contribution of appreciated shares of stock in a closely held corporation to a charity that administered donor-advised funds. Hoensheid is important not only in the general area of advising philanthropically inclined clients but also in the specific area of the assignment-of-income doctrine in the context of charitable gifts.

Regarding charitable surviving spouses, the panel discussed Estate of Horvitz v. Comm’r, in which an estate claimed a deduction for estate tax purposes for its charitable contributions.

State Tax Decisions

Not to ignore some of the interesting state court decisions, we also learned about Acklie v. Nebraska Dep’t of Revenue, in which the Nebraska Supreme Court held that owners of a major American trucking company didn’t abandon their domicile in Nebraska for a permanent residence in Florida.