In an "intentionally defective grantor trust" in which the grantor
retained the power to substitute assets....may the grantor substitute
cash for appreciated stocks owned by the trust so that the appreciated
stocks end up back in his estate and eligible for a step-up in basis
upon his death? (Obviously, the question assums that no capital gains tax is
triggered by substitution itself...if this is a false assumption
please explain.)
If the answer is yes....does it make any difference if the
intentionally defective grantor trust owns the appreciated stocks in
an LLC entity.