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| Charitable remainder trust is one, and prolly the best way to avoid recapture. It’s not a total loophole though, as a formula will be utilized to determine a remainder amount for charity. But it’s still a wonderful tool. Another would be to keep it and rent it to you, inheriting it in the end, receiving stepped up basis. After all, he should want retirement income, and you want cheap payments, so good for both. Figure out a point where he has collected enough in rent, you no longer owe it anymore. You may need to allow for time value of money. I’ve found 8% of the current value of a piece of equipment is kinda the sweet spot. After 12 1/2 years, he will have received 100 % of the original value back in rental payments. After that, he’ll need to decide if not having the use of his money up front for over twelve years is worth an extra payment or two, or to cut the payments a year or two short because he owed no tax. It’s simply a point to negotiate. If there are other heirs, a succession plan spelling out the terms and conditions is necessary to protect your interests, as well as the other heirs in case he dies prematurely. Feel free to shoot me an email for more clarification if you wish.
Edited by Boone & Crockett 2/17/2019 07:12
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