A Knight in Nondeductible Armor
Overview
The Supreme Court recently decided the Knight case (Knight v. Comr., No. 06-1286, 101 AFTR2d ¶2008-380), affirming the Rudkin case, Rudkin v. Comr., 467 F.3d 149 (2nd Cir. 2006), which limits trust deductibility of investment management expenses, effectively increasing the taxes imposed on trusts which use professional investment managers.