Webinar
This course is drawn from Steve Gorin’s 3rd quarter 2026 newsletter. First, the Tax Court held that remaindermen who consented to trust termination and distribution to the income beneficiary made a massive gift by consenting, even though the income beneficiary had a power of appointment. This will take about half of our time. Next, we will discuss two key Court of Appeals decisions determining how protective is (or is not) the exclusion of limited partners from self-employment tax. Finally, we will review how the estate tax inclusion period (ETIP) rule affects allocations of GST exemption and related tax issues.
October 27, 2026
12:00 PM CT
McDougall v. Commissioner, 163 T.C. 112 (2024), held that children made taxable gifts to their father, Bruce McDougall, when they agreed to terminate a QTIP trust and permit him to receive all of its assets. Lewis v. Commissioner, T.C. Memo. 2026-58, determined that those gifts were valued as the amount the children would have received upon termination, expressly ignoring the fact their faither’s power of appointment could have directed assets away from them upon his death. We will discuss the planning implications of that result, including planning for business assets held in a QTIP trust.
We will revisit the rules for the limited partner exclusion from self-employment tax. At first, in Sirius Solutions, L.L.L.P. v. Commissioner, 165 F.4th 374 (2026), the Fifth Circuit accepted a broad interpretation of the exclusion, then withdrew and narrowed its interpretation (after the taxpayer changed its name) in K Alain, L.L.L.P. v. Commissioner, No. 24-60240 (Aug. 12, 2026) (per curiam). The Second Circuit determined a similar definition in Soroban Capital Partners LP v. Commissioner, No. 25-2079 (Sept. 17, 2026). Both of these differ from the Tax Court’s very narrow definition. We will discuss the playing field going forward.
In the generation-skipping transfer area, the estate tax inclusion period (ETIP) rule generally prevents a trust’s inclusion ratio from being set until the trust would no longer be included in the transferor’s gross estate if the transferor died during that time. Letter Rulings 202628005 (by omission) and 202633002 inform our understanding of ETIP consequences. We will review how the ETIP rule works and its planning implications.
CLE
The live presentation of this webinar was approved for 1.50 hours of general CLE credit in California, Illinois, and Texas; 1.80 hours of general CLE credit in Missouri; and 1.50 hours of professional practice CLE credit in New York. Please visit the CLE Overview page to see how the CLE credit for this recorded webinar can be applied in CA, IL, MO, NY, & TX.
If you are interested in receiving CA, IL, MO, NY, or TX CLE credit for watching the recorded presentation, you must register for the program by clicking here.
Participants will only be emailed a Certificate of Attendance if the webinar is viewed in its entirety. If you were unable to view the webinar in its entirety, please contact [email protected] to see if you are eligible to receive partial credit.
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