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Author: csm1rr Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121061  
Subject: Re: Need tax consequences advice please Date: 1/30/2013 2:30 AM
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Gee, looks like my tax questions gave more questions instead of answers. Thank you to everyone who has been replying.

Re: the service mark and the PAT weblinks. I have not seen any such service mark on anything from my parents' lawyers office on any of their documents, nor mine. Also, interesting to note that when I went to their lawyer's website, there is NO mention about Personal Asset Trusts on there at all. Their website does mention about estate planning and estate administration.

Quoting from Bill's post:
(My parents had a Living Trust. After my mother's death, the estate was split, creating a Survivor's Trust and a Decedent's Trust.) 

"OK. Up to this point that sounds like very conventional estate planning."

After my father's death, the estate was divided into two PATs. I have a Personal Asset Trust and so does my brother. <snip>  

"I also am not familiar with the term "Personal Asset Trust." I don't know if that's something peculiar to your state's laws or whether it's a brand name of the brokerage it's invested with."

The term is not from any brokerage firm, and since y'all never heard the Personal Asset Trust term, maybe it is terminology from the state of Texas since I live in it.
Bill does have it correct about my parents' Living Trust, very conventional estate planning.
I thought that the PAT was a conventional "next phase" of the plan after both parents had died.


The lawyer who set up our Personal Asset Trusts is an estate lawyer. The CPA who has done my taxes for 20 years must be close to 90 years old or past that milestone. 

"Well, those are the two guys you should talk to about the requirement (or not) to file a 1041."

Okay, I googled tax form 1041 to see what it was....looks like it applies to the decedent estate and last tax return. I'm sure our CPA did do the 1041 forms and all those filings for both of my parents. I will definitely ask him about filing rules for my trust needing to file a return. And I have also added the questions Bill mentioned to ask the lawyer in his post as well.

Peter mentioned about my CPA's fees and I suspect that he is correct that my 90 year old CPA did not raise his fees with the market. Especially true for folks who have stayed with his business for so long.

Phil posted:
My trust is a Personal Asset Trust, (or PAT).

"Just in case old Dobbin has a breath left in him, here goes.
At least two Fools have posted links to descriptions of PATs, and I googled another. I find it interesting that all, each from a different law firm, use exactly the same verbiage to showcase the whiz-bang-wow factor of this instrument which hardly any lawyers know about. Call me a cynic, but
Danger, Will Robinson! Danger!
I am no doubt prejudiced from spending too much time debunking tax scams which "nobody knows about but us," but borrowing from Peter's advice about types of investments, I'd be leery of anything my own attorney couldn't explain to me.

Why should you care? Well, you can't figure out what your tax responsibilities are as trustee until you figure out the nature of the beast you're trustee of. The only thing I feel comfortable saying at the moment is that IRS is going to be looking for a 1041 from the trust if more than $600 of income is reported under its EIN."
Phil
Rule Your Retirement Home Fool

After reading that website, I really now wish that my trust had a different name. That website does scream tax scam but that was not at all my parents intent. I will definitely need to know the nature of this beast that I am trustee of. Thank you for pointing out possible consequences for NOT knowing!!! I am safe for tax year 2012 as for this trust and its earnings not being over $600.

Op456op posted:
In addition to an estate type attorney to get things explained and then an Enrolled Agent or CPA for taxes, with regard to your investment mix questions, I would recommend you see a Fee ONLY Investment advisor from Garrett Planning: http://garrettplanningnetwork.com/or one selected from NAPFA: http://www.napfa.org/ The only fee they get is what they charge you and not any kickback commissions for pushing specific mutual funds with loads. Also be wary of any annuity products or "leveraged planning" regardless of any "guaranteed income" promise.

Thank you for posting both of these website links to help me find a fee only financial planners. I am surprised because I live in the 4th largest US city and the closest financial planner office with Garrett Planning is 20 miles away. The NAPFA website gives me 4 office locations that are much closer to my location for fee based financial planners.

I have posted a few non-tax questions on these Fool boards, posting a question on THIS Tax Strategies board was truly an eye opening experience.

Carolyn
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