EFTA01452350.pdf

have no New York trustees, no properly located in New York, and no New York-source income). Second. the bill would eliminate a loophole" that allows so-called incomplete gift, non-grantor trusts ("INGs" or "DINGs,- if the trusts are created in Delaware) to completely avoid New York income tax; it would do so by making the trust a "grantor trust" for New York income tax purposes — meaning that the creator of the trust would be taxable on the trust's income for New York purposes. even though the creator is not taxable on that income for federal purposes. Although these proposals would be retroactive to January 1, 2014 if enacted. some transition rules would apply: accumulation distributions paid before June 1. 2014 would be exempt, and the ING rules would not apply to income from a trust that is liquidated before June 1, 2014. Comments. This proposed legislation reflects recommendations from the Trusts and Estates section of the New York Bar Association that were included in the November 2013 report from the Tax Reform and Fairness Commission. According to the bill's supporting memorandum, the provisions would increase tax revenues by $75 million in fiscal year 2014-15, $225 million in fiscal year 2015-16, and $150 million annually thereafter. In other words, these proposals are perceived as money-makers. Yet whether that would indeed be the case remains to be seen: wealthy New Yorkers seem unlikely to view these changes as 'improvements" to the taxation of trusts, but rather, as another reason to move out of New York. January and February 7520 rates issued The IRS has issued the January and February 2014 applicable federal rates: the January 7520 rate is 2.2%. an increase of 0.20% (20 basis points) from December's 2.0% rate. January's mid-term rates are also up slightly, and are: 1.75% (annual), 1.74% (semiannual and quarterly), and 1.73% (monthly). February's 7520 rate continues to climb: it is 2.4%, and the February mid-term rates are also up: 1.97% (annual), 1.96% (semiannual and quarterly) and 1.95% (monthly). December's mid-term rates were: 1.65% (annual), 1.64% (semiannual and quarterly), and 1.63% (monthly). Blanche Lark Chrislerson is a managing director at Deutsche Asset & Wealth Management in New York City, and can be reached at [email protected]. The opinions and analyses expressed herein are those or the autlyr and do not necessarily reflect those of Deutsche Bark AG or any affiliate thereof (collectively. the "Bank') Any suggestions contained herein are general. arid do not take Into account an inthviduars specrlic arcisovances or applicable governing law, which may vary from jurisdiction to jurisdiction and be subiect to change. No warranty or representation, express or implied. is rnacle by Ile Bank, nor does the Bank accept any liability with respect to the information and data set forth herein The information contained herein is not intended to be. and does not constaute, legal. tax, accocatirs2 or other professional advice: a is casts not intended to offer penalty protection or to prbmote. market or recommend any transaction or matter addressed herein. Recapieras should consult their applicable professional advisors prior to acting on 11* information set forth lwrein This material may not be reproduced withe44 the express permission of the auth*r 'Deutsche Bar.t° mewls Deutsche Bank AG and its affiliated companies. Deutsche Asset & Wealth Management represents the asset management and wealth management activities conducted by Deutsche Bea AG or its subsidiaries. Clients are provided Deutsche Asset & Wealth Management produids or sensces by ore or more *gal entities that are identified to clients pursuant to the contracts. agreements offering materials or other documentation relevant to such products or services. Trust and estate and wealth planning services are provided through Deutsche Bank Trust Company. Deutsche Bank Trust Company Delaware and Deutsche Bank National Trust Company. 412014 Deutsche Asset & Wealth Management. All rights reserved 01rz71 012914 Ta T‘44:, ' 4 CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0 109305 CONFIDENTIAL SDNY_GM_00255489 EFTA01452350