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1 Tax and nontax consequences of various estate plans (outright distributions, transfers in trust, etc) A Tax implications (1) Income tax Income (dividends, etc) generated by the property will be taxed to the donee after the transfer The donee s basis is the lesser of (a) The fair market value (FMV) (b) The donor s basis, with an adjustment for the gift tax paid (2) Gift tax Complete versus incomplete gifts If a donor can unilaterally retrieve the gifted property, there has not been a completed transfer Therefore, the gift tax is not triggered (contrast the tax implications of this with a completed gift with a retained interest) However, if the transfer is a completed gift, the donor will have a gift tax liability to the extent that the FMV of the gift on the date of the transfer is greater than the available annual exclusion and/or any permissible charitable or marital deductions (3) Tax exclusive nature of gifts A donor will not pay gift tax on the funds that are used to pay the gift tax In contrast, the estate tax is tax inclusive, meaning that the estate will pay taxes on the funds that will be used to pay the estate taxes Consequently, if all other factors are equal, from a transfer tax perspective, it is less expensive to transfer assets during lifetime than at death (4) Impact of gifting on the estate tax A completed gift that does not involve a retained interest will usually affect a decedent s potential estate tax calculation by (a) Decreasing the value of the gross estate (b) Increasing the value of the adjusted taxable gift (c) Decreasing the tax base B Custodial gifts (UGMA and UTMA) (1) Income from custodial property is taxed to the minor (at a rate based on the kiddie tax) whether distributed or not, except to the extent that it is used to discharge a parental obligation of support (in the latter situation, it is taxed to the parent) (2) Gift tax liability is triggered by the irrevocable transfer Because the child is legal title holder, the gift is one of a present interest, qualifying each dollar of gifted custodial property for a dollar of annual exclusion (up to the applicable maximum annual limit) C Section 2503(b) mandatory income trust (1) Income tax: Unlike a custodial account, the trust is a taxable entity separate from the bene ciaries However, because income must be distributed to the income bene ciaries, it is taxable to them at the appropriate tax rate (2) Gift tax liability is triggered by the irrevocable transfer The mandatory distribution of income creates a present interest qualifying for an annual exclusion However, because the gift to the trust is split between the income (present interest) and remainder (future interest) bene ciaries, only part of each dollar of gift property (the portion going to the income bene ciary) will qualify for the annual exclusion.



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the responsibilities (or contracts) developers have Furthermore, there's the big decision on how to handle persistence: specifically whether it should be container managed or bean managed In fact, if we decide to deploy an entity bean using container-managed persistence, the recent EJB 20 specification gives us even more options, making development of an entity bean very different from that of other kinds of beans Let's take a more detailed look at entity bean development by first reviewing the interfaces and classes that an entity bean designer must develop:





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import java.util.*; import javax.naming.*; import javax.naming.directory.*; public class CheckPassword { public static boolean checkPassword(String uid, String password) { // get initial context // these properties could also be specified // on the command line or in a jndi.properties file Hashtable env = new Hashtable(); env.put(Context.INITIAL_CONTEXT_FACTORY, com.sun.jndi.ldap.LdapCtxFactory ); env.put(Context.PROVIDER_URL, ldap://localhost/o=Connexia Airlines ); try { DirContext ctx = new InitialDirContext(env); SearchControls controls = new SearchControls(); controls.setReturningObjFlag(true); controls.setSearchScope( SearchControls.OBJECT_SCOPE); String filter = userPassword= +password; NamingEnumeration answer = ctx.search( uid= +uid, filter, controls); return answer.hasMore(); } catch(NamingException e) { e.printStackTrace(); return false; } } public static void main(String args[]) { System.out.println(checkPassword( jmcgovern , red )); System.out.println(checkPassword( jmcgovern , blue )); } }

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The remote interface: methods exposed to remote clients, mostly accessor-like methods The EJB 20 specification allows entity beans to have local interfaces, which enables finer granularity without compromising performance The home interface: methods that allow entity beans to be created (ie, factory-like methods) and located Locator methods are also known as "finder" methods EJB 20 has "select" methods as well The bean class: a combination of accessor-like methods for interrogating object attributes and methods for managing database integration and object identification Depending on how bean persistence is handled, there may be many private methods related to database access

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the database world is changing, it took a very long time for that early vision of OLE and COM to be accepted by the developer community, and only then did it reach maturity. It is hoped that the software life cycle for .NET will not be as steep or as long and will enjoy a much longer ride at its pinnacle. While Microsoft is making assurances that the COM binary standard will be around through Vista and the next version of the Windows OS, Windows 7, the likelihood that it will begin descending into obscurity sometime thereafter is real. The movement toward XML-based data transfer is safely beyond critical mass. This leaves COM and the original ADO to play only a legacy role. As one convincing signal of that progression, with ADO.NET 3.5, Microsoft is recommending that the high-level ADO data access implementation of COM be accessed only through the ADO primary interop assembly (PIA) (ADODB.dll). Figure 32-1 shows how this assembly exposes the unmanaged COM components into the managed .NET environment. The ADO code remains essentially ADO code, but through the PIA it will be managed by the CLR, rather than at the operating system layer. This will not mandate large changes in legacy implementations of ADO, though some changes will be necessary. Nor does it mean that current ADO implementations will be much different from before when written in .NET. It will still be necessary to specify a valid OLEDB data provider in the ADO connection string, for example, and to understand the interfaces and requirements of each of those data providers. Conversely, constructors and garbage collection, security, and runtime type checking (courtesy of the .NET Framework) come into play.

Notice that these classes are similar to those for the session beans shown earlier However, there are a few minor differences, most of which relate to a single benefit record being similar to a row in a table of benefit records In general, the methods found in an entity bean fall into these categories:

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