Structuring Tax-Efficient Trust Decantings After ‘the Guidance’

The publication of Chief Counsel Advice Memorandum 202352018 (“the CCA”) shook up the tax and estate planning community as it provided practitioners a glimpse into how the IRS may soon begin to analyze tax issues arising from a popular estate planning technique known as “trust decanting” — invading the corpus of one trust and transferring the assets into another — more than a decade after it had solicited public comments on the matter.

While some practitioners have called the CCA the “death of irrevocable trust decanting,” and others have opined that the CCA may have a “chilling effect” on estate ...