Thus, the exclusion does not apply to any sale by a taxpayer if, during the two year period ending on the date of the sale, there was any other sale by the taxpayer to which the exclusion applied. However, this once every two year rule is applied without regard to any sale occurring prior to May 7, 1997. Maximum utilization of the new exclusionary rule requires some planning. They could then purchase a new principal residence at the same cost as the sales price for the old principal residence and start all over with no built-in gain as of the date of purchase of the new principal residence. Accordingly, the new exclusionary rule does provide some incentive to sell your existing principal residence and purchase a new one before the built-in gain in your existing principal residence exceeds the applicable exclusionary amount.
Trusts are a popular estate planning instrument.
This article will summarize in general terms the Rule and what a third-party trustee must do to meet the Rule's investment standard. If you have specific questions regarding the investment of trust assets or the administration of a trust, please call our office. The Rule, as set forth in the Oregon Uniform Prudent Investor Act is a default rule that may be expanded, restricted, eliminated or otherwise altered by the provisions of a trust. If not modified by the trust's terms, the Rule requires a trustee to invest and manage trust assets as a prudent investor would, by considering the purposes, terms, distribution requirements and other circumstances of the trust. The trustee must exercise reasonable care, skill and caution.