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May 1, 2008 12:00 PM
CUSTOM BOND VALUATIONS DON'T (NECESSARILY) SAVE MONEY
The belief that estates can realize significant estate tax savings from custom bond valuations is based largely on the inefficiencies of the fixed income markets and the use of standard bond valuations. There's some validity in that belief, but nowadays, the discrepancy between the prices that institutions and individuals receive for bonds should not be that great. Standard bond valuations shouldn't be that “off” from custom bond valuations and shouldn't produce significant estate tax savings.
During the past five years, giant strides have been made to create transparency and efficiency in the bond markets. The biggest step forward is that all corporate and municipal trades must be reported to their regulating authority in a timely fashion. For municipal bonds trading in the secondary market, trades are reported to the Municipal Securities Rulemaking Board (MSRB). For corporate bonds trading in the secondary market, trades are reported to the Financial Industry Regulatory Authority (FINRA). All trading information is available through the Internet and can be viewed at www.investinginbonds.com. This website is published by the Securities Industry and Financial Markets Association (SIFMA) in an effort to educate investors. The site is user-friendly and informative, showing all transactions in the municipal and corporate markets.
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Topics of Interest
| Estate Tax | Donor Advised Funds |
| GSTs | Family Offices |
| Private Foundations | Life Insurance |
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Topics of Interest
| Estate Tax | Donor Advised Funds |
| GSTs | Family Offices |
| Private Foundations | Life Insurance |
| 2010 Tax Act News | Industry Trends Surveys |
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