This article reprint was published in Volume 40 of the Tax Management Estates, Gifts and Trusts Journal and provides an overview of the federal tax laws known as the Delaware Tax Trap, including:A review of the Trap’s history.How to spring and not to spring the Trap, and when to spring and not to spring the Trap.A summary of how the Trap works under current Delaware law and how it works under the laws of some other states.
The decision whether and how to best transition out of your business is seldom easy. Several key factors may include: (i) financial needs moving forward for you and your family; (ii) your desire to remain involved in the business in some capacity; (iii) the involvement of business partners and/or family members; (iv) the impact of income and/or estate taxes; and (v) market conditions.
Learn why Delaware is considered one of the most advantageous jurisdictions for personal trusts. Even if you don’t live in Delaware, there are numerous reasons why you should consider establishing a new trust in Delaware and why you should explore moving an existing trust to the First State.Wilmington Trust Company operates offices in Delaware only.