T

A mutual fund that gradually adjusts asset allocation over time into more conservative categories as it approaches a target retirement age. • “[A] diversified target-date fund . . . shifts money from stocks to bonds as investors age . . . .” Anne Tergesen, Why a Bull Market Is a Bad Time to Check Your 401(k), WSJ, June 15, 2023 (Apple News link).

“Here’s the short answer: Tariffs are a tax on imported goods. They generally make affected consumer products more expensive. In theory, well-designed tariffs will also encourage targeted industries to produce more in the United States. And manufacturing certain goods domestically — instead of importing them from abroad —may have national security or economic benefits. Trump’s own rationales for his tariffs are numerous and shifting: He sees them as a tool for raising revenue, enhancing national security, and revitalizing the US economy by increasing domestic manufacturing jobs. But the president’s tariffs are so broad, high, and ever-changing that they could actually backfire.” Eric Levitz, 5 big questions about Trump’s tariffs and how they might work, Vox, April 2, 2025 (Apple News link).

For trusts: Tax accounting is the process of preparing and filing tax returns for the trust and its beneficiaries. Tax accounting follows the rules and regulations of the Internal Revenue Service (IRS) and the state tax authorities. Tax accounting is mainly concerned with complying with the tax laws and minimizing the tax burden of the trust and its beneficiaries. C.f. fiduciary accounting.

Services that “go beyond the tax return and into the world of tax strategy and optimization.” What is tax advisory?, Thomson Reuters, July 6, 2023. C.f. tax compliance services.

“The U.S. and many countries use . . . a tax bracket system in which a different tax rate is applied to different levels of taxable income.” TheStreet Staff, What Is a Marginal Tax Rate? Definition & Example, TheStreet, May 24, 2023 (Apple News link).

Regarding an estate tax: Having an estate tax exemption apply and then having it immediately and completely disappear at the next dollar. • “It is important to reiterate that no tax is due on estates whose Connecticut taxable estate is $2 million or less. However, where the Connecticut taxable estate exceeds the $2 million threshold, the basis for the tax is the total value of the Connecticut taxable estate, including the first $2 million. This is known as the ‘cliff’ effect. You will see references to the cliff in our survey responses.” Estate Tax Study, Connecticut Department of Revenue Service, Feb. 1, 2008.

Services that include preparing federal, state, and local tax returns. C.f. tax advisory services.

Reduces taxes dollar-for-dollar.

A major tax reform law that was passed in 2017. It lowered the tax rates for individuals and businesses, increased the standard deduction and the estate tax exemption, and made other changes to the tax code. However, most of the changes for individuals are not permanent and are set to expire by the end of 2025, unless Congress extends them or enacts new legislation. This means that starting from 2026, the tax rates and brackets will revert to their pre-TCJA levels, the standard deduction will decrease, and the estate tax exemption will be halved.

Reduces taxable income.

A long-term monthly payment plan through the IRS. If you owe $50,000 or less for tax, penalties, and interest; then you can set up an installment plan online. For larger amounts, you must call the IRS.

Adjusted gross income minus the greater of the standard deduction or itemized deductions. • When computing income taxes, taxpayers apply income tax rates to taxable income.

A tax strategy that uses losses to offset profits. See Kevin Khang, Thomas Paradise & Joel M. Dickson, Tax-loss harvesting: A portfolio and wealth planning perspective, Vanguard, Oct. 2020; Greg Iacurci, As stocks tumble, this tax play offers a silver lining, CNBC, May 9, 2022 (Apple News link); Kate Dore, Here’s when tax-loss harvesting makes sense . . . and when it doesn’t, CNBC, June 8, 2022 (Apple News link); Laura Saunders, Got Losses on Stocks, Bonds or Crypto? There’s a Silver Lining at Tax Time, WSJ, June 10, 2022 (Apple News link). • “Tax-loss harvesting is one reason many people are opening SMAs for direct indexing—an investment strategy that involves buying the underlying securities of an index such as the S&P 500. It lets them sell individual stocks that have declined in value to realize losses so they can offset capital gains and to keep more profits.” Lori Ioannou, Brokerage Firms Are Pitching Separately Managed Accounts. Here’s What to Know., WSJ, Jan. 7, 2024 (Apple News link).

Creating and implementing a plan to minimize taxes. • Tax preparation is essentially forward-looking. C.f. tax preparation.

Reporting income and deductions on a tax return. • Tax preparation is essentially backward-looking. C.f. tax planning.

The percent by which a tax base is multiplied to determine a taxpayer’s tax liability. See, e.g., IRC §§ 1 (federal income tax), 2001 (federal estate and gift taxes), 3101 (federal employment tax), and 4001 (federal excise taxes).

See treasury bill.

A special joint ownership for married couples based on the idea that a married couple is one person. Each spouse owns the whole, not a share of the whole. Creating it requires the four unities of time, title, interest, and possession. Its key feature is a right of survivorship, which is indestructible. This means that upon the first spouses’ death, the surviving spouse remains seized of the entire property. The right of survivorship is indestructible because a spouse cannot bring a partition action to sever and terminate the tenancy by entirety, and one spouse cannot defeat the other spouse’s right of survivorship. • In New York, a tenancy by the entirety applies only to real property and COOPs. EPTL 6-2.1(4). It is the default estate when such property is transferred to a married couple. EPLT 6-2.2(b), (c). The deed does not need to recite the intent or interests of the parties. See Bartholomew v. Marshall, 257 A.D. 1060, 13 N.Y.S.2d 568 (3rd Dep’t 1939) (where property was conveyed to husband, wife, and child “without further words showing the intention of the parties,” finding that “[w]hen real property is conveyed to a husband and wife and third person, the husband and wife have one moiety as tenants by the entirety, and the third person is a tenant in common with them of the other.”). • The notion of two people, each owning the whole individual, as if they were one person is difficult to grasp and counterintuitive. In a dissenting opinion, Chief Justice Weintraub stated, “The estate by entirety is a remnant of other times. It rests upon the fiction of a oneness of husband and wife. Neither owns a separate distinct interest in fee; rather each and both as an entity own the entire interest. Neither takes anything by survivorship; there is nothing to pass because the survivor always had the entirety. To me the conception is quite incomprehensible.” King v. Greene, 30 N.J. 395, 413, 153 A.2d 49, 60 (1959). • A tenancy by the entirety “is incompatible with community property system’s basic theory of a conjugal partnership in acquisitions and gains and, therefore, was never recognized in the eight community property states.” Cornelius J. Moynihan & Sheldon F. Kurtz, Introduction to the Law of Real Property 303 (7th ed. 2020).

“[A]s the name indicates, a unique form of co-ownership by which specific partnership assets, both real and personal, are held by partners. The concept of tenancy in partnership is a creation of the Unif. Partnership Act, § 25. The Act has been adopted in all states. See 6 U.L.A. 7 (Supp.1987).” Cornelius J. Moynihan & Sheldon F. Kurtz, Introduction to the Law of Real Property 309 n.1 (7th ed. 2020).

See tenant-in-chief.

In feudal times a person holding land directly under the king. In Latin, the term is “tenant in capite.”

In feudalism, an individual who actually occupied land and “had property rights consisting of a general right to possess, use, and enjoy the land.” Cornelius J. Moynihan & Sheldon F. Kurtz, Introduction to the Law of Real Property 7 (7th ed. 2020).

In feudalism, peasants who tilled the soil. Tenants paravail formed the broad base of the pyramidal feudal social structure.

In feudal times land holding from a lord in exchange for a service to that lord. • Tenure was classified either as unfree or free.

In feudalism, a type of frankalmoin tenure that required specific religious acts (such as saying mass for the grantor a specific number of times a year) by the religious grantee.

See military tenure.

For a bond: “[T]he amount of time over which it is scheduled to make payments.” Penelope Wang, 8 Things You Need to Know About Bonds, AARP Bulletin, Aug. 2023 (Apple News link).

Traditionally, an instrument disposing personal property. • Historically, a testament related solely to personal property and a will to real estate. • C.f. will.

Ways of passing property at death other than a will. • Testamentary substitutes include lifetime trusts, joint ownership with a right of survivorship, and assets that have a beneficiary designation filled out (such as life insurance and retirement plan designations).

A trust that is created under a will and takes effect after the testator dies. C.f. lifetime trust.

Someone who dies with a will. C.f. intestate.

Someone who writes a will

“Once you have an idea of what your annual spend will look like, you can work backwards using the 4% rule, which essentially says that you can safely withdraw 4% of your retirement assets each year.” Laila Maidan & Kathleen Elkins, FIRE Movement: Early retirees discuss limitation, need to resume working, Business Insider, Sept. 13, 2023 (Apple News link).

See fiduciary duty.

“[W]hen Baby Boomers will pass on more than $70 trillion in wealth to younger generations.” Allison L. Lee, I Wish I May, I Wish I Might: Estate Planning’s Gentle Nudge, Kiplinger, March 22, 2023 (Apple News link). • Cerulli Anticipates $84 Trillion in Wealth Transfers Through 2045, Cerulli Associates, Jan. 20, 2022.

A survey of Great Britain conducted in 1874. • See Domesday Book.

“[T]he fact that observing a situation or phenomenon necessarily changes it,” Ken Baclawski, The Observer Effect.

A market in which bond yields are so low that stocks are the only investment choice. • “Tina” stands for “there is no alternative.” Investing in just stocks instead of allocating funds between stocks and bonds is considered suboptimal. See Investopedia, TINA: There Is No Alternative. • For example, the “TINA effect” occurred in August 2019 when 60% of the stocks in the S&P 500 (1.7%) and most individual sectors offered dividend yields that exceeded the yield on 10-year U.S Treasury notes (1.640%). See Michael Wursthorn, Falling Bond Yields Make Equities Hard to Ignore, WSJ, Aug. 13, 2019 (Apple News link). • In April 2022, market conditions (falling stock prices and rising bond yields) signaled the end of the TINA effect. See Dion Rabouin, Wall Street Finds New Value in Cash as Global Fears Weigh on Markets, WSJ, April 25, 2022 (Apple News link). 

A retirement plan for employees of the United States government, including members of the uniformed services. See https://www.tsp.gov/

“Money received sooner is more valuable than money received later. . . . Present-value calculations overcome the initial objection to breakeven analysis by accounting for the time value of money. Payments received this year are treated as being more valuable than those received the next year, and so forth.” John Rekenthaler, Should You Delay Taking Social Security Benefits?, Morningstar, Sept. 28, 2023 (Apple News link).

Respecting real property: “The word ‘title’ has two meanings: 1) the right to ownership of real property, and 2) evidence of ownership by a deed.” Terrence Dunn & Ira H. Goldfarb, Title to Real Property, New York City Bar: Legal Referral Service, July 2017. • “A properly-conveyed deed should be recorded to provide notice to the world of ownership. Title to real property can be held by one person or by multiple people. Title can also be held by a trust or a business entity.  When title is held by more than one owner, there are three ways to hold title to the same property: Tenants in common . . . Joint tenants . . . Tenants by the entirety . . . .” Id.

Insurance that protects owners of real property and mortgage lenders against future claims for past defects in a chain of title regarding a specific piece of property. • Title insurance covers defects in a property’s title that show up on a title report, such as an open mortgage, a governmental lien, or an open mortgage. • Title insurance does not cover (1) the value of the property (so, it doesn’t insure that someone is getting a good deal for the purchase price), (2) the use of the property (e.g., commercial or residential), (3) the zoning of the property (e.g., high density zoning v. low density zoning), (4) the ability to obtain permits from municipalities, (5) hazardous materials (i.e., environmental issues), and (6) issues regarding the land (e.g., damage caused by activities on adjacent properties).

A written analysis of the status of title to real property.

See coins.

(1) Investment: “Total returns ‘include dividend reinvestment as well as price appreciation.’ R. Ibbotson, G. Brinson, Investment Markets 65 (1987).” Joel C. Dobris, Probate World at the End of the Century: Is a New Principal and Income Act in Your Future, 48 Rec. Ass’n B. City N.Y. 280 (1993).

(2) Trust investment: A trust investment approach that strives for “the optimal amount of gain for the trust given its risk/reward tolerance, regardless of whether the gain is classified for trust accounting purposes as income or principal. Although this investment approach may maximize the financial success of the trust as a whole, it exacerbates the conflict between the income beneficiaries and the remaindermen, who have strong preferences about whether the character of the receipt from the investment lands in the ‘income’ account or the ‘principal’ account.” Alyssa A. DiRusso & Kathleen M. Sablone, Statutory Techniques for Balancing the Financial Interests of Trust Beneficiaries, University of San Francisco Law Review, Winter 2005.

“We may enter into a total return swap (‘TRS’) agreement. A TRS is a contract in which one party agrees to make periodic payments to another party based on the change in the market value of the assets underlying the TRS, which may include a specified security, basket of securities or securities indices during a specified period, in return for periodic payments based on a fixed or variable interest rate. A TRS effectively adds leverage to a portfolio by providing investment exposure to a security or market without owning or taking physical custody of such security or investing directly in such market. Because of the unique structure of a TRS, a TRS often offers lower financing costs than are offered through more traditional borrowing arrangements. We would typically have to post collateral to cover this potential obligation.” HPS Corporate Lending Fund, Form 10-K, March 21, 2024.

“Without the ability to adjust the amount that can be distributed to the income beneficiary, Total Return investing is a moot point. A ‘Total Return Trust,’ then, is a trust that (by trust instrument, law or fiduciary discretion) allows the fiduciary to invest for Total Return but also allows adjustment of the amount to be distributed to the current beneficiary, without regard to whether the distribution is composed of dividends, interest, rent, capital gain or otherwise. We do not, however, restrict the term ‘Total Return Trusts’ to only those trusts that can distribute fiduciary accounting ‘income.’ We include in the definition all trusts that allow for discretionary distributions of income and principal, since the practical result of making a discretionary distribution versus changing the definition of income are essentially the same is a trust that (by trust instrument, law or fiduciary discretion) allows the fiduciary to invest for Total Return but also allows adjustment of the amount to be distributed to the current beneficiary, without regard to whether the distribution is composed of dividends, interest, rent, capital gain or otherwise.” Paul S. Lee, Implementing Total Return Trusts (2002). See total return.

“[M]easures assets deposited as collateral on DeFi platforms.” Paul Vigna, DeFi Is Helping to Fuel the Crypto Market Boom–and Its Recent Volatility, WSJ, June 3, 2021 (Apple News link). See decentralized finance.

From footnote 26 of the Third Report of the Temporary State Commission on the Modernization and Simplification of the Law of Estates to the Governor and the Legislature, May 31, 1964: “So called because In the Matter of Totten, 179 N. Y. 112, 71 N. E. 748 (1904), established the place in New York of the informal revocable trust of a savings-bank deposit. The Court of Appeals therein announced the following conclusion: ‘A deposit by one person of his own money, in his own name as trustee for another, standing alone, does not establish an irrevocable trust during the lifetime of the depositor. It is a tentative trust merely, revocable at will, until the depositor dies or completes the gift in his lifetime by some unequivocal act or declaration, such as delivery of the passbook or notice to the beneficiary. In case the depositor dies before the beneficiary without revocation, or some decisive act or declaration of disaffirmance, the presumption arises that an absolute trust was created as to the balance on hand at the death of the depositor.’ Id. at 125-26, 71 N. E. at 752.”

See U.S. Treasuries.

A short-term debt security issued by the U.S. Department of the Treasury to help finance government operations, typically with maturities ranging from a few days to one year. Unlike bonds, treasury bills (T-bills) are sold at a discount from their face (par) value and do not pay periodic interest; instead, investors earn a return when the bill matures at its full face value. Because they are backed by the U.S. government and highly liquid, T-bills are considered one of the safest investments, often used by individuals, institutions, and governments to park cash temporarily or manage short-term funding needs.

“[A] type of Treasury bond whose principal is indexed to inflation and used to protect investors from inflation . . . .” Lisa Scherzer, Bonds Are a Great Buy Now. How to Protect Yourself., Barron’s, Aug. 19, 2023 (Apple News link).

See treasury stock.

Refers to shares that were once outstanding and have been bought back by the issuing company from shareholders. These shares are then held by the company, reducing the total number of shares available on the open market. • Also known as treasury shares or reacquired stock.

See bench trial.

A legal device in which a settlor transfers the legal title of assets to one or more trustees, who manage and distribute the assets to one or more beneficiaries. • A property owner uses a trust in lieu of making an outright gift. • A trust makes it “possible to separate the benefits of ownership from the burdens of ownership.” 1 Austin W. Scott, Trusts §1, at 2 (William F. Fratcher 4th ed. 1987), qtd in Jesse Dukeminier et. al., Wills, Trusts, and Estates 771 (7th ed. 2005). • “[T]he modern trust is preeminently a management device for separating ownership and enjoyment . . . .” John H. Langbein, The Contractarian Basis of the Law of Trusts, 105 Yale L.J. 625 (1995). • “[T]he normal private trust is essentially a gift, projected on the plane of time and so subjected to a management regime.” Bernard Rudden in 44 Mod. L. Rev. 610 (1981) (book review), qtd in Jesse Dukeminier et. al., Wills, Trusts, and Estates 771 (7th ed. 2005).

NY EPTL 11-1.1(a)(2) defines a trust for purposes of NY EPTL 11-1.1 (Fiduciary powers):

(a) As used in this section, unless the context or subject matter otherwise requires, . . . (2) [T]he term ‘trust’ means any express trust of property, created by a will, deed or other instrument, whereby there is imposed upon a trustee the duty to administer property for the benefit of a named or otherwise described income or principal beneficiary, or both. A trust shall not include trusts for the benefit of creditors, resulting or constructive trusts, business trusts where certificates of beneficial interest are issued to the beneficiary, investment trusts, voting trusts, security instruments such as deeds of trust and mortgages, trusts created by the judgment or decree of a court, liquidation or reorganization trusts, trusts for the sole purpose of paying dividends, interest, interest coupons, salaries, wages, pensions or profits, instruments wherein persons are mere nominees for others, or trusts created in deposits in any banking institution or savings and loan institution.“

“Trust fiduciary law regulates the trustee’s exercise of discretion. Be it in trust law or in other fields of fiduciary obligation (for example, corporations, agency, or partnership), fiduciary duties are default norms imposed in juridical relations that feature ‘scope for the exercise of discretion.’” John H. Langbein, The Contractarian Basis of the Law of Trusts, 105 Yale L.J. 625 (1995). See fiduciary duty.

A specific type of indenture used in bond or debt security transactions that establishes the terms governing the relationship between the bond issuer, trustee, and bondholders. It outlines the trustee’s fiduciary duties, the rights of bondholders, and the obligations of the issuer, often including provisions for managing collateral and remedies in case of default. Trust indentures are subject to specialized laws, such as the Trust Indenture Act of 1939, to protect bondholders’ interests. See, e.g., Beck v. Manufacturers Hanover Trust Co., 218 A.D.2d 1, 632 N.Y.S.2d 520 (App. Div. 1995).

One or more people named in a trust to act in a non-fiduciary capacity to ensure the trustee is adhering to the trust settlor’s intent and wishes.

“Trustees are the legal owners of the trust. As such, they control the management of the trust assets and the distributions a beneficiary receives. The trustee cannot use the trust assets for their benefit, but they have to act honestly and in good faith for the benefit of the beneficiaries and abide by the trust terms.” Christine Fletcher, Unhappy With Your Trustee? 5 Ways To Remove Or Replace A Trustee, Forbes, Dec. 22, 2023 (Apple News link). • In a third-party trust, a person (i.e., an individual or a financial institution) who accepts the transfer of assets from a settlor and agrees to manage and distribute the assets to the trust’s beneficiaries pursuant to the terms of the trust agreement. In a trust where the settlor is the sole trustee, an individual who makes a written declaration to manage and distribute assets (that the individual transferred to the trust) to the trust’s beneficiaries (who the individual named). • Trustees are fiduciaries, which means they are held to a higher standard when discharging their duties. • A trust can name one or more trustee. • When a trust has more than one trustee, the trust should state whether they have the same or different duties, and whether they can act jointly or separately.

See settlor.

“Turnkey properties are homes that are fully functioning and ready to rent out immediately.” Kathleen Elkins, How to use HELOC home equity line of credit buy property build wealth, Business Insider, Oct. 13, 2022 (Apple News link).

“[A] complete set of characters of a particular and consistent design for the composition of text, and is also called a font. Typefaces often come in sets which usually include a bold and an italic version in addition to the basic design.” Supreme Court of the State of New York, Appellate Division: Second Judicial Department, A Glossary of Terms for Formatting Computer-Generated Briefs, with Examples.