Tag: 6502

Beneficiaries and Trustees May Face Personal Liability for Unpaid Estate Taxes

Cases, Estate Administration, Estate and Gift Tax, Tax Controversy, Tax Court

A recent federal district court decision[1] highlights the significant risk that beneficiaries and fiduciaries may face when estate assets are distributed before federal estate tax liabilities have been fully satisfied.[2] In United States v. Karst, the court granted summary judgment in favor of the government and held that the decedent’s sons, who were named as…
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Successor Trustee Liability for Unpaid Estate Tax

Cases, Court of Appeals, Estate Administration, Estate and Gift Tax, Estate Planning, Fiduciaries, Tax

In a previous writing, I discussed the potential of an executor to be personally liable for a decedent’s tax obligations.[1] That discussion was based on lessons learned from a Tax Court opinion,[2] outlining certain steps for executors to consider in minimizing exposure to such personal liability. In 2023, in a split decision, the Ninth Circuit…
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