Transfer on Death and Estate Planning Vehicles

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Chapters in this video

  1. 0:00 Carla's estate and the TOD probate vs estate tax trap
  2. 2:18 JTWROS vs TIC at death
  3. 3:34 Stepped-up basis on the decedent's share only
  4. 3:56 UGMA and UTMA irrevocable gifts and the donor-custodian trap
  5. 5:33 Kiddie tax: the $1,350 and $2,700 thresholds
  6. 6:30 Rapid-fire exam recap

What this video covers

  • Why a Transfer on Death (TOD) account avoids probate but is still pulled into the decedent's gross estate for estate tax purposes
  • How Joint Tenants with Right of Survivorship (JTWROS) passes the entire account automatically to the survivor with no probate
  • How Tenants in Common (TIC) sends the decedent's share through the estate and into probate, not to the co-owner
  • Why only the decedent's share receives a stepped-up cost basis in both JTWROS and TIC, while the survivor keeps original basis
  • Why Uniform Gifts to Minors Act (UGMA) and Uniform Transfers to Minors Act (UTMA) gifts are irrevocable, and how UTMA allows broader asset types and a later age of majority
  • The donor-as-custodian trap that drags custodial assets back into the donor's gross estate at death
  • The 2025 kiddie tax tiers: first $1,350 tax-free, next $1,350 at the child's rate, and unearned income above $2,700 taxed at the parent's marginal rate

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