Transfer on Death and Estate Planning Vehicles

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Chapters in this video

  1. 0:00 TOD registration: probate avoidance versus gross estate inclusion
  2. 2:37 JTWROS and TIC: survivorship versus distinct shares
  3. 4:38 UGMA/UTMA: irrevocable gifts and custodian estate trap
  4. 6:14 Kiddie tax: $1,350, $2,700, and parent's marginal rate
  5. 7:02 Rapid-fire exam recap

What this video covers

  • Why a transfer on death (TOD) account avoids probate but remains in the decedent's gross estate for tax purposes
  • How joint tenants with right of survivorship (JTWROS) passes the entire account automatically to the survivor, skipping probate entirely
  • Why tenants in common (TIC) sends the decedent's distinct share through their estate and into probate, rather than to the co-owner
  • The stepped-up basis rule: only the decedent's share receives a step-up in both JTWROS and TIC accounts
  • What makes UGMA and UTMA gifts irrevocable completed gifts, and why the donor cannot reclaim the assets
  • The custodian trap: how a donor-custodian's death before the minor reaches majority pulls UGMA/UTMA assets back into the gross estate
  • The kiddie tax structure: first $1,350 tax-free, next $1,350 at the child's rate, and anything above $2,700 taxed at the parent's marginal rate

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