Creative Planning with Encumbered Real Estate

So many of our clients own investment real estate, and whether it’s a major portion of their estate or not, whether it’s one property or many, real estate can be a substantial asset that requires planning in and of itself. When planning for real estate, so many aspects and elements need to be taken into consideration. Today’s solution may present an entirely different picture years down the road, after depreciation, mortgage interest deductions, and when considering selling that real estate.

The GNJEPC is very excited to have none other than Stephen M. Breitstone, Esq.; Chair, Private Wealth and Taxation Practice Group; Meltzer, Lippe, Goldstein & Breitstone, LLP (Mineola, NY), presenting LIVE on Creative Planning with Encumbered Real Estate. Stephen is an industry veteran known nationally for his creative planning for clients who own real estate. Just one of his creative planning strategies is using Grantor Trust Substitution Power(s) for a Grantor Trust’s Encumbered real estate. When doing this type of planning there are various obstacles and traps to avoid, and Stephen is going to talk about all of them, as well as potential solutions so that you can do creative and beneficial planning for your clients.

Stephen will show us how to design a partnership, with a preferred interest and a common interest, and various alternatives used to transfer the common interest to an irrevocable grantor trust. Because it is common for real estate to have a mortgage, Stephen will show us how the non-recourse liabilities can be allocated to the preferred partnership interest. His presentation will also include various nuances that can provide tremendous benefits to our clients – like when properties are refinanced, including how to increase the income tax and estate tax benefits if the extra cash from the refinancing is distributed to the preferred partner – including how to use the grantor trust income tax rules to obtain a further step-up in basis at death.

Stephen’s presentation will cover just some of the following:

· How to design a partnership with encumbered real estate, with a preferred interest and a common interest.

· How and why the income tax benefits of the preferred partnership freeze can be increased if the excess cash from future mortgage refinancings is distributed to the preferred partner.

· How a preferred partnership “rescue plan” (designed to use the grantor trust substitution rules) can allocate the mortgage liabilities back to the decedent and obtain a step-up in basis at death – without increasing the value of the decedent’s estate.

Stephen is the Chair of the Private Wealth and Taxation Practice Group of Meltzer, Lippe, Goldstein & Breitstone, LLP. His approach to planning combines business planning and income, estate and gift tax planning, with a special emphasis on real estate. His clients include domestic and international real estate owners and developers, closely held businesses, public companies, private equity funds, trusts and estates, and charitable organizations. Stephen’s combination of skills as a transactional and income tax attorney and as an estate planner enables him to effectively advise clients on their individual needs and those of their businesses. Stephen frequently serves as general counsel and financial and business advisor to several of his clients, and he has been an expert witness in litigation over Section 1031 exchange transactions. He has been an adjunct professor, teaching Tax and Business Planning for Real Estate Transactions and Taxation of Partnerships at Cardozo Law School and is a Fellow of both the American College of Trusts and Estates Council (“ACTEC”) and the American College of Tax Council (“ACTC”). Stephen is currently a co-chair of ABA’s Sales, Exchange and Basis Committee (“SEB”) and a Fellow of the American Bar Foundation. He has presented at the NYU Institute on Federal Taxation, Practicing Law Institute, Notre Dame Tax and Estate Planning Institute, Bloomberg BNA Tax Management, National Multi-Housing Conference, Jeremiah Long Section 1031 Conference, Federation of (1031) Exchange Accommodators, and other national forums and venues. Stephen has also been interviewed on tax and financial topics by local and national media, including CBS, ABC, Fox, Fox Business News, The New York Times, the Wall Street Journal, and Bloomberg, among others.

Stephen will be with us live and in-person -- as this will be a LIVE EVENT ONLY. This is going to be a “Don’t Miss” event and a great second meeting for our 2024-2025 council!

Event Venue & Nearby Stays

BACARI GRILL, 800 Ridgewood Road, Washington Twp, United States