Podcast Summary: Bob Keebler on The Renaissance of Income Tax Planning

AICPA Personal Financial Planning (PFP) Episode | January 23, 2026
Host: Kerry Sinnett (AICPA & CIMA)
Guest: Robert (Bob) Keebler, CPA/PFS, MST, AEP (Distinguished Tax and Estate Planning Expert)

Episode Overview

This episode delivers an in-depth look into the “renaissance” of income tax planning strategies, focusing particularly on the powerful role of non-grantor trusts under current U.S. tax law. Bob Keebler shares advancements brought by the “One Big Beautiful Bill Act (HR1),” the flexibility of trust structures, and practical strategies for maximizing client benefits, especially with recent elevated estate tax exemptions and ongoing phase-outs of income tax deductions.

The discussion emphasizes actionable, creative ways CPA financial planners can help clients lower taxes on income by leveraging new rules, deploying multiple trust vehicles, and shifting income among family members — all within legal guardrails.

Key Discussion Points & Insights

1. The Shift from Estate to Income Tax Planning

[02:31] - [03:02]

• Trend: With the estate tax exemption now at $15 million per individual ($30 million for couples), estate tax situations are rare (only 1 out of 400 estates affected).
• Result: Far more planning energy is being directed at income tax minimization rather than estate tax management.

“Now that we have, at least through the end of the current administration, no estate tax, there’s going to be a renaissance with the use of non grantor trust for income tax purposes.”
— Bob Keebler [02:31]

2. The Power of Non-Grantor Trusts for Income Shifting

[03:29] - [04:45]

• Phase-Outs & Opportunities: Higher income clients lose access to major deductions (SALT, Section 199A, etc.) when income exceeds statutory thresholds.
• Income Shifting Concept: By moving income off the personal Form 1040 (individual tax return) to Form 1041 (trust tax return), it’s possible to drop below phase-out zones and preserve deductions.

Example:
If $600K in income disqualifies a taxpayer from SALT deductions, shifting $100K into a trust for children/grandchildren brings the taxpayer back into the SALT deduction range.

“If I move $100,000 of that income over to a trust for my children and grandchildren, my income is now only $500,000, and I get my SALT deduction back.”
— Bob Keebler [03:29]

3. Trust Structures: Completed vs. Incomplete Gift Trusts

[04:45] - [05:35]

• Completed Gift Trust: Property is out of the estate; trust files its own tax return.
• Incomplete Gift Trust: In some states, retains step-up in basis at death; trust still files separate return.
• State Law Is Key: Some states facilitate more flexible trust planning (e.g., Wyoming, Nevada, Alaska, South Dakota, Delaware).

“You can make those non grantor trusts…with a completed gift which would get that property out of your estate. Or in a handful of states we can create an incomplete gift trust.”
— Bob Keebler [04:45]

4. Five Core Strategies for CPAs Using Non-Grantor Trusts

[05:55]

1. Shifting Income Across Generations: Allocate to children/grandchildren (watch out for the kiddie tax).
2. Expand the SALT Deduction: Use separate trusts to multiply the deduction across multiple tax filings.
3. Enhance Section 199A Deduction (QBI): Use trusts to maximize this deduction by keeping income below critical phase-out thresholds.
4. Stacking QSBS (Qualified Small Business Stock) Exemptions: Use multiple trusts to multiply the $10M exemption for eligible gains.
5. State Income Tax Reduction/Deferral: Relocate trust situs to low-tax states to defer/avoid high-state income taxes.

5. Practical Example: Multi-Generational Income Shifting

[06:57] - [08:15]

• Scenario: Client with three children and nine adult grandchildren. All income eligible to be spread.
• Savings: If top-bracket grandparents (37%) shift income to children in the 12%-22% bracket, achieve a 15-25% tax arbitrage.
• Net savings: Potential to save $20,000 per $100,000 transferred.

"If somehow we average a 20% arbitrage and we do that, for every $100,000 we transfer, we save $20,000."
— Bob Keebler [07:55]

6. Expanding the SALT Deduction With Multiple Trusts

[08:27]

• Double Dipping: Individuals and trusts can each claim the SALT deduction separately.
• Illustration:
  • Create a slant (spousal lifetime access non-grantor trust) for spouse.
  • Move enough property so the trust generates $100K of income.
  • Individual income drops from $600K to $500K; both parties claim SALT deductions (limit increases from $10K to $40K as a result).

"So if my wife and I were at $600,000 of income, I could create a trust...so now our income...is only $500,000. The trust has $100K. We get a SALT deduction in both places."
— Bob Keebler [08:27]

7. Guardrails: Avoiding IRS Trust “Collapsing” Rules (Section 643F)

[09:55] - [10:38] | [13:55] - [14:47]

• What Not to Do:
  • Cannot create multiple “identical” trusts for the same beneficiary and expect separate tax treatment; the IRS will aggregate (“collapse”) these under IRC Section 643F.
• What Works:
  • Separate trusts for different children (and their “issue”) count as unique. Different grantors (e.g., grandparent and parent) can create trusts for the same beneficiary.
• Legal Drafting: Careful, professional trust drafting is essential.

"Keep them separate. And our lawyer friends will be responsible for that drafting to make sure that the drafting just has to be rather adroit to get there."
— Bob Keebler [10:41]

8. Stacking Section 199A (QBI) Deductions

[10:51] - [13:19]

• Issue: Specified Service Trades or Businesses (SSTBs, like accountants or doctors) phase out for Section 199A below $395K income (married couples).
• Strategy: By shifting equity into separate trusts for children/grandchildren, income can be lowered below phase-outs across multiple taxpayers/trusts.
• Impact: Example with 15 family members—rather than $20K, deductions can reach ~$400K.

“Instead of getting $20,000 of the 199 cap a deduction, we were looking at closer to $400,000 of the deduction.”
— Bob Keebler [13:09]

9. Identifying Ideal Clients for Non-Grantor Trust Planning

[15:17]

• Best Candidates:

  • High-income earners losing SALT or 199A deductions due to phase-outs
  • Families able to benefit from intergenerational income shifting (adult children/grandchildren in lower brackets)
  • Business owners with eligible QSBS gains
  • Residents of high state income tax states open to out-of-state trust situs

• Red Flags:

  • Simple financial profiles or clients who don’t face deduction phase-outs may be better off with simpler structures.

“I think you start with do you have anyone that can't get the SALT deduction? Is there a way to get income off of their return? Then you ask yourself, is there anybody that can't get 199 cap A?...”
— Bob Keebler [15:17]

Notable Quotes

• “Congress is basically saying if your income's too high, we're going to take away your SALT deduction.”
  — Bob Keebler [03:29]

• “Now what doesn't work is if I had three children and I set up three trusts for three children...the government's going to collapse those, treat you like one trust. But if it's a trust for A and her issue, B and her issue, C and her issue, we're great.”
  — Bob Keebler [09:55]

• “If you’re a CPA financial planner, unfortunately financial planning falls into that bad group, you do not get your 199cap a deduction if you make more than...$395,000.”
  — Bob Keebler [11:13]

• “As long as you keep the income at the trust level below $197,000, the trust would also get a 20% QBI deduction. And that's very powerful.”
  — Bob Keebler [12:29]

Key Takeaways for Financial Planners

• Non-grantor trusts are making a comeback—they can be essential tools for maximizing income tax deductions in today’s landscape.
• Smart structuring, including the use of multiple, properly-drafted trusts, can allow high-net-worth families to restore valuable deductions eliminated by income phase outs.
• Guardrails exist—professional trust drafting is crucial to prevent the IRS from combining trusts (Section 643F aggregation rules).
• Not every client is a fit. Focus on those with substantial income and complex, multi-generational family structures, or high state tax exposure.

Essential Segments and Timestamps

• Intro to the Renaissance of Income Tax Planning: [00:00] – [02:31]
• Current Tax Landscape and Need for New Strategies: [02:31] – [04:45]
• Five Trust-Based Income Tax Strategies: [05:55] – [06:37]
• Income Shifting Mechanics and Trust Stacking: [06:57] – [09:55]
• Guardrails and Section 643F: [09:55] – [10:47], [13:55] – [14:47]
• Section 199A Trust Opportunities: [10:51] – [13:19]
• Identifying Ideal Clients: [15:17] – [16:26]

This episode is a must-listen for financial professionals aiming to stay at the forefront of modern income tax planning, especially in light of sweeping legislative changes and the evolving use of non-grantor trusts.