Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

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Tuesday, April 8, 2014

Gurlitt Allows Investigators to Retain Artworks

Cornelius-Gurlitt-via-Der-Spiegel

As I have previously discussed, Cornelius Gurlitt had over a thousand modern masterpieces, many of which were likely confiscated by Nazis, stashed away in his Munich flat.

Gurlitt has reached an agreement with German authorities to allow a task force to hold onto at least 593 artworks.  The task force will look into the ownership of the works for the next year.  Gurlitt will receive back works considered “unproblematic.”  The works are currently being displayed online in the hopes that claimants will come forward.

For further information on Cornelius Gurlitt and his cache, here is a segment on 60 minutes.

See Josie Le Blond, German Collector Cornelius Gurlitt Allows Investigators to Retain Artworks, The Guardian, Apr. 7, 2014.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.

April 8, 2014 in Current Affairs | Permalink | Comments (0) | TrackBack (0)

Sunday, April 6, 2014

Survey Shows Adults Are Financially Illiterate

Financialliteracy

April is Financial Literacy Month and many adults need more of it according to a new survey: 

The National Foundation for Credit Counseling found that 61% of U.S. adults do not have a budget.  Other worrisome findings include 34% of households carrying month-to-month credit card debt, 60% not checking their credit score in the last year, and 41% grading themselves a “C” or lower in financial literacy. 

Those who are a part of the budget-less 61% should take these three simple steps to begin creating a plan for where their money is best spent:

  1. Determine monthly net pay.
  2. List major expenses.
  3. Track discretionary spending.

See Libby Kane, 61% of US Adults Don’t Keep Track of Their Money, Business Insider, Apr. 2, 2014.

April 6, 2014 in Current Affairs, Estate Planning - Generally | Permalink | Comments (1) | TrackBack (0)

Tax Court Ruling Helps Trusts Avoid Passive Loss Limitations

GavelRecently, the Tax Court in The Frank Aragona Trust v. Comm'r.,  held that it is now an option for a trust to qualify for the coveted title of "real estate professional" under the passive loss rules. This holding permits trusts to avoid the passive loss deduction limitations. The IRS claimed the trust could not be a real estate professional because the test for real estate professional looked to "personal services," and a trust was an entity that could not perform personal services. Additionally, the IRS if a trust qualified, the relevant participation must come from the fiduciaries in their capacity as fiduciaries and not as employees. The court disagreed with the first claim and did not rule on the second issue, but did say a trust could qualify as a real estate professional.

See Steven R. Schneider, Tax Court Decision Will Help Trusts Avoid Passive Loss Limitations and New 3.8% Tax, Tax Law Round Up, Mar. 29, 2014.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.

April 6, 2014 in Current Affairs, Current Events, Income Tax, New Cases, New Legislation | Permalink | Comments (0) | TrackBack (0)

Friday, April 4, 2014

Ohio to Recognize Same-Sex Marriages

Gay-ohio

A federal judge is striking down Ohio’s voter-approved ban on same-sex marriage, meaning Ohio will have to recognize marriages of gay couples who legally wed elsewhere.

U.S. District Judge Timothy Black said he will issue the ruling April 14, giving time for the state to prepare an appeal.  His ruling will prohibit Ohio officials from enforcing the ban, which he says violates constitutional right of equal protection and due process, but the ruling does not mean Ohio must allow couples to marry in the state.

See Janet Loehrke, Ohio Will Have to Recognize Gay Marriages, Judge Says, USA Today, Apr. 4, 2014. 

Special thanks to Laura Galvan (Attorney, San Antonio, Texas) for bringing this article to my attention.  

April 4, 2014 in Current Affairs | Permalink | Comments (0) | TrackBack (0)

Thursday, April 3, 2014

Is Brandon Howard the Son of Michael Jackson?

Brandon-Howard-3213426

Last month, DNA results seemingly confirmed that musician Brandon Howard is the biological son of the late Michael Jackson.  With the legitimacy and accuracy of the results being challenged, new DNA tests are being run that will hopefully produce more conclusive results. 

Brandon Howard (who goes by B Howard) is the son of singer Miki Howard, who was managed by Joe Jackson and was nicknamed “Billie.”  Brandon Howard says that regardless of the results of the DNA tests, he wants to continue his own musical career and will not pursue any portion of the Jackson estate.

See Audrey Palmer, Brandon Howard and Michael Jackson DNA Retested in Public, TV Mix, Apr. 2, 2014.

April 3, 2014 in Current Affairs, Music | Permalink | Comments (1) | TrackBack (0)

Love, Lies, and Loss

Love and money

When twenty-six-year-old Amanda Marks was short one dollar at a Walgreens register, eighty-five-year-old Clifford Rogerson stepped in to help.  From there, the couple’s relationship blossomed.  While the two held hands, kissed, and dined together, Rogerson also loaned Marks over $20,000. 

Although Marks promised to repay the sum, she soon disappeared from Rogerson’s life.  Not only was Rogerson’s heart shattered, but so was his retirement account.  Rogerson filed a police report last May, and on Tuesday afternoon (Apr. 1), Marks finally surrendered at the county courthouse. 

See Woman Who Bilked 85-Year-Old Man of $20k Surrenders, NBC 6 South Florida, March 31, 2014. 

Special thanks to David S. Luber (Florida Probate Attorney) for bringing this article to my attention.

April 3, 2014 in Current Affairs | Permalink | Comments (0) | TrackBack (0)

Wednesday, April 2, 2014

Beware the New York Estate Tax Cliff

Empire_state_building_amcrmar07_13

On April 1, New York state more than doubled its estate tax exemption amount from $1 million to $2,062,500.  And by 2019, the New York exemption will match the generous federal exemption, projected to be $5.9 million.  This will make planning easier for a lot of people, but there is still one big trap New Yorkers should look out for.

New Yorkers who die with just 5% more than the new exemption will face a “cliff.”  They will be taxed on the full value of their estate, not just the amount over the exemption.  This means the new law could translate into a marginal New York estate tax rate of nearly 164%, as shown in this comment letter from the New York State Society of CPAs.

See Ashlea Ebeling, The New New York Estate Tax Beware a 164% Marginal Rate, Forbes, April 1, 2014.

April 2, 2014 in Current Affairs, Estate Tax | Permalink | Comments (0) | TrackBack (0)

Article on State Tax Law in a Post-Windsor World

Rings Nicholas A. Mirkay III (Creighton University -School of Law) recently published an article entitled, "Equality or Dysfunction? State Tax Law in a Post-Windsor World", (March 11, 2014). Creighton Law Review, Vol. 47, No. 2, 2014. Provided below is the abstract from SSRN:

Depending on one’s religious and political proclivities, the United States Supreme Court’s decision in United States v. Windsor can either been seen as a progressive step towards equality or a troublesome departure from traditional marriage norms. Notwithstanding, from a federal tax perspective, the Windsor decision clearly raised a myriad of issues that spanned virtually the entire Internal Revenue Code (the “Code”), including but not limited to income taxes (including filing status), estate and gift taxes, payroll taxes, and the tax treatment of retirement account contributions and social security benefits. In the aftermath of Windsor, the Internal Revenue Service (“IRS”) was left with a quandary in administering marital-status-dependent Code provisions: should it base its administration of the Code on the taxpayer’s valid marriage in the state in which it was performed (commonly referred to as the “state of celebration” test) or the taxpayer’s state of residence or domicile (commonly referred to as the “state of residence” test)? The IRS resolved most of the federal tax issues raised by Windsor in its issuance of Revenue Ruling 2013-17, which chiefly adopted a state of celebration test for income and other tax purposes. However, the ruling did not extend to quasi-marital statuses, such as domestic partnerships and civil unions, resulting in federal tax non-recognition and complexities for couples in those legally recognized relationships.

Windsor also raised innumerable state and local taxation issues, particularly for the majority of the states that outright ban, or otherwise do not recognize, gay marriages. The Windsor decision’s failure to completely repeal all provisions of the Defense of Marriage Act (“DOMA”), specifically Section 2, permits states to continue such bans or lack of recognition, resulting in significant state and local tax complexities for same-sex couples that reside in such states but chose to marry in one of the seventeen states (and District of Columbia) that permit it. Thus, a post-Windsor world remains complex and uncertain for a majority of married same-sex couples. As with federal taxation, for couples in a domestic partnership or civil union, their state and local taxation issues remain much as they did prior to Windsor and Revenue Ruling 2013-17 – complex and uncertain.

April 2, 2014 in Articles, Current Affairs, Current Events, New Cases, New Legislation | Permalink | Comments (0) | TrackBack (0)

Tuesday, April 1, 2014

New Twist in Case of Lorenzen Wright Estate

Alg-lorenzen-wright-jpg

The Tennessee Court of Appeals recently ruled that Shelby County Probate Court Judge Robert Benham overstepped his authority in the battle over murdered NBA star Lorenzen Wright’s estate.

Benham appointed a guardian to investigate lavish spending by ex-wife Sherra Wright.  Within ten months, Sherra Wright spent almost all of the $1 million in proceeds she received from an insurance policy on her husband’s life.  The appeals court vacated Benham’s judgment directing the guardian ad litem to take actions, ruling he “acted beyond the scope of (his) jurisdiction.”

See Marc Perrusquia, BRIEF: Local Judge Overstepped Authority in Lorenzen Wright Estate Case, Appeals Court Says, Insurance News Net, March 28, 2014.

April 1, 2014 in Current Affairs, New Cases, Sports | Permalink | Comments (0) | TrackBack (0)

L'Wren's Family Speaks at Her Funeral

L’Wren ScottAs I have previously discussed, L’Wren Scott committed suicide and left a will that left her entire $9 million dollar estate to Sir Mick Jagger.  Scott made it clear in her will that she did not want her family to receive anything from her estate. Despite Scott's choice to exclude her family from inheriting any of her estate, they spoke at her funeral and divided her ashes among the family and Mick Jagger. Her brother claims that he will bury some of the ashes in Utah. Additionally, another ceremony to commemorate Scott will be held in Utah for other family and friends to attend.

You can check out L’Wren Scott ‘s will here.

See Aly Weisman, L'Wren Scott Leaves Entire $9 Million Estate To Mick Jagger, Mysteriously Leaves Out Family, Business Insider, Mar. 27, 2014.

Special thanks to Laura Galvan (Attorney, San Antonio, Texas) for bringing this article to my attention. 

April 1, 2014 in Current Affairs, Current Events, Estate Administration, Wills | Permalink | Comments (0) | TrackBack (0)