Q: A husband died on February 24, 1985 and left House 1 (principal place of residence) to his wife as life tenant. In 1989, the wife sold House 1 and the executors of the estate allowed this so fund could be used by the wife to buy House 2 (new principal place of residence). In 1996, the wife wanted to return to Sydney and wished to buy House 3 (principal place of residence). The executors of the estate allowed this but there was a shortfall of funds to purchase House 3. The executors permitted son A to purchase one-third of House 3. The estate purchased two-thirds of the house. The wife and son continued to live in House 3. To document this transaction, a deed of family arrangement was signed by the executors and other children on March 11, 1996. In total, there are five adult children including son A. The deed grants an option to son A to purchase the estate's share of House 3 on the vesting of the property to the original beneficiaries. The wife died on August 2, 2015. Under the terms of the deed, son A purchased the estate's share of House 3 at market value.
Q: A husband died, leaving a substantial estate. His wife was the executor and initially the sole beneficiary of the estate. Due to some US tax law issues arising out of the wife's US citizenship, it was desirable that she does not receive all the assets in the estate. With her support, her three adult children sought and obtained Supreme Court orders under the New South Wales Succession Act 2006 whereby they became entitled to a certain parcel of income-producing real estate.
Q: My client had properties under his name and a trust. He passed away and left his investment properties to his three children as per the will. For tax and business activity statements (BASs) purposes, we have created an estate for those properties that were under his name. We have lodged BASs for the estate for those properties that the client owned and for the family trust for those properties that were under the trust for the quarter ended September 30, 2016. However, the children have now transferred all the properties to their individual names as per the will. My questions are:
Q: My client passed away last month and left his investment properties to his three children as per the will. However, one of the conditions is that the income from those properties is to be distributed among his three children and eight grandchildren for the next 15 years. Can we set up a trust to which income from those properties get transferred so that the trust can distribute the income to the 11 beneficiaries (equal share) for the next 15 years?
Q: A client who passed away during the 2016 financial year. We are in the process of completing his tax affairs for the 2016 year and need advice in regards to how to treat income from assets after his date of death. The individual owned several commercial properties with his wife. I have yet to establish if the property was owned as tenants in common or joint tenants. It is my understanding that if the property is owned as joint tenants, then the property automatically defaults to the surviving individual. If this is the case and there are no other assets or income, is there a need to complete an estate tax return or is the income from the property split up to the date of death and defaulted to the wife for the remainder of the year? Does the fact that the property has not been transferred with the titles office as at June 30, 2016 have any impact on this? Can a family discretionary trust distribute income to a deceased estate?
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