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Strategies & Market Trends : Repeal the Estate Tax? -- Ignore unavailable to you. Want to Upgrade?

To: BWAC who wrote (24)	8/9/2000 1:49:13 PM
From: donjuan_demarco	Read Replies (2) \| Respond to of 30

BWAC that sounds like a SCIN or self-cancelling installment note. They were the rage a few years ago but I haven't kept up with them. I think there are a few rulings on the issue, I know the IRS didn't like them. The term "Defective Grantor Trust" in my experience refers to a trust that will not be included in the grantor's estate, but, because of an intentional "defect" is a grantor trust for income tax purposes. Re the deal you describe, I assume that the idea is the client will give the interest in the LLC to his kids, and the LLC doesn't have much fair market value because of the debt (or argue it is a real sale?)? So all the value is retained in the trust, whose only asset is the note. But when the guy dies, the note has no value. Sounds like a "heads I win, tails you lose" deal, since I'm not up to date on SCINs, I can't really say whether it works or not.