Wills, Trusts & Estates Prof Blog

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

Friday, September 23, 2016

Unintended Consequences of the § 2704 Proposed Regulations

Income tax reductionThe estate-planning world is still buzzing over the § 2704 proposed regulations released last month. These regulations restrict discounts that may result in a net loss of revenue to the Treasury with higher transfer tax values, leading to higher bases for transferees. Seemingly, increases in the estate tax that result from higher valuations would offset the income tax losses on later dispositions of the inheritance. However, this valuation also applies to estates that are not large enough to incur an estate tax, further binding them to the reductions in discounts from the new proposals. Additionally, the IRS is also bound. It can potentially foresee a diminishment in income tax revenues when heirs sell those inheritances for a smaller gain. Consequently, businesses that have been successful but not lavishly so can benefit from passing inheritances to those with higher bases, creating the diminishment of future income tax liabilities and no estate tax burden.   

See Dominick Schirripa, The Law of Unintended Consequences Meets the §2704 Proposed Regulations: Will Estate Tax Increases Cause Income Tax Reductions?, Bloomber Estate Tax Blog, September 15, 2016. 

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


September 23, 2016 in Current Events, Estate Planning - Generally, Estate Tax, Income Tax | Permalink | Comments (0)

Article on Blowing Inheritance in the Great Wealth Transfer

Wealth transfer2Darren T. Case recently published an Article entitled, Blown Inheritance: An Alarming Issue During the Great Wealth Transfer, Arizona Attorney 38 (July/August 2016). Provided below is a summary of the Article:

It’s been estimated that $30+ trillion in wealth will transfer to the next generation over the next few decades. Some forecast that just under 20 percent of that wealth is already in motion, as it is being held by families with life expectancies of seven years or less. While practicing law in the estate planning, probate, and trust areas during the “greatest wealth transfer in human history” certainly will be intriguing, it will arguably be one of the most challenging times, as well. Of the trillions of dollars set to transfer to the next generation, recent studies show that 50 percent of the inheritances will be blown—and most will be blown quickly. 

Many families may cringe when learning such a staggering statistic, but the question is what, if anything, can attorneys do to combat the loss or dissipation of estates? 


September 23, 2016 in Articles, Current Events, Estate Planning - Generally | Permalink | Comments (0)

Thursday, September 22, 2016

Heir to Art-Dealing Estate Faces Major Tax Fraud Scandal

GuyOn Thursday, the heir, Guy Wildenstein, to a major art-dealing dynasty appeared in court for one of the biggest tax fraud trials ever in France. Wildenstein is accused of hiding a billion-dollar family fortune in offshore tax havens. If convicted, he faces up to ten years in prison and a substantial bill for back taxes. Wildenstein denies these accusations. 

See Kim Willsher, Heir to Art-Dealing Estate in Court in Major French Fraud Trial, Guardian, September 22, 2016. 

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


September 22, 2016 in Current Events, Estate Planning - Generally, New Cases | Permalink | Comments (0)

The Boston Estate Planning Council Receives Its Second Consecutive "Council of Excellence" Award

BepcThe Boston Estate Planning Council (BEPC), a multi-disciplinary community of over 700 estate and wealth planning professionals, today announced that it has received the Leonard H. Neiman and Walter Lee Davis, Jr. Council of Excellence Award for the second consecutive year. This is the highest honor the National Association of Estate Planners & Councils (NAEPC) can bestow. BEPC shares this year's award in the largest size category with the Cleveland Estate Planning Council.  

The award, first given out in 2015, recognizes councils that successfully provide a strong multi-disciplinary environment for estate planning professionals within their community, and honors those councils that work to grow their programs and services and to provide an exceptional member experience. Award recipients will be honored at a ceremony during the NAEPC Advanced Estate Planning Strategies Conference Council Leadership Day, November 16, 2016 in Litchfield Park, Arizona. 

"We are honored to receive our second consecutive Council of Excellence Award from the NAEPC," said Dan Flanagan, Canby Financial Advisors, President, Boston Estate Planning Council. "Our dedicated member volunteers are the ones who deserve this recognition, for their commitment and untiring efforts during the year that have benefitted our membership, their clients and the community."

BEPC is a member of the NAEPC, the leading professional organization for estate planners, which provides ongoing education and a forum for professional networking to its 1,800 Accredited Estate Planner® designees, and to 260 affiliated local estate planning councils and their 29,000 members. BEPC and its members will receive additional benefits from the NAEPC as part of the award.


September 22, 2016 in Current Events, Estate Planning - Generally | Permalink | Comments (0)

The Mob Informant with a $100 Million Inheritance

SaganLee Power, a wealthy widow, would eventually sign away more than $100 million in her will to a man she had known for two years, Alben Sagan or, as he was also known, The General. The two met in late 2008, and Sagan soon became her ever-present companion. Over the next few years, Sagan became the president of her real estate companies, negotiating multi-million-dollar sales. Upon Power’s death, her family was curious as to why 90% of her fortune was left to a man they barely knew. Shortly after, her sister wrote a scathing letter to the Manhattan Surrogate’s Court objecting to the will. 

So who is Alben Sagan? Sagan was a ex-military officer who had given testimony on several organized crime figures, eventually forcing him into the witness protection program. Eventually, Sagan could not handle the lifestyle and reverted back to his old lifestyle in New York with longtime friends. Trying to keep his past a secret, he was unable to hide when he was set to inherit $100 million. 

Currently, Sagan’s past life is at the forefront of a fierce legal battle over the validity of Power’s will. Lawyers for Power’s nieces allege that Sagan preyed on a wealthy woman suffering from dementia to gain control over her real estate portfolio, which is estimated to be worth around $80 to $120 million. Sagan claims that Power was of sound mind when she drafted her will.     

See James Fanelli, How a Mob Informant Who Left Witness Protection Got $100M from a Widow, dna info, September 20, 2016. 

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.


September 22, 2016 in Current Events, Elder Law, Estate Planning - Generally, New Cases, Wills | Permalink | Comments (0)

Wednesday, September 21, 2016

Federal Court Uses Princess Lida Doctrine to Dismiss Trust Dispute

Court houseA new federal case with reliance on the Princess Lida doctrine dismisses a federal trust dispute whilst a pending trust dispute resides in state court. In Genovese v. Genovese, the decedent created a testamentary trust for his two children, one of which was a plaintiff for this case. The trust named the decedent’s father as trustee. After various disputes, the plaintiff filed suit in federal court against the trustee, bringing four counts. The defendants moved to dismiss the first two counts, arguing that because the state court had already taken jurisdiction over the trusts, the federal court could not subsequently take concurrent jurisdiction over those same trusts. The Princess Lida doctrine supports this argument by preventing a federal court from taking such jurisdiction. The rule, however, only applies if the federal action is in rem versus in personam. Accordingly, the court ended up dismissing both counts; however, count II was dismissed for other reasons based on an in personam contract, which restricts the Princess Lida doctrine. 

See Jeffrey Skatoff, Federal Court Dismisses Trust Dispute with Pending State Court Trust Dispute, Florida Probate Lawyers, September 19, 2016. 


September 21, 2016 in Current Events, Estate Planning - Generally, Trusts | Permalink | Comments (0)

Tuesday, September 20, 2016

The New Rising Class of the Mega Wealthy

Penta millionaireAmericans are becoming richer quicker. For example, last year, there were 492 American billionaires, evidencing that 100 new billionaires were created in the past five years. Another historical threshold is the 5% increase from 2014 of households with more than $5 million in investible assets. These statistics introduce a broader, younger, more geographically diverse group of self-made magnates. Another growing trend with these moguls is their age and gender; more and more of the ultra wealthy are female and much younger than we have seen in the past. Their fortunes, however, are not keeping them from regular fears and insecurities, such as their investment portfolios, financial security, and the effect of wealth on their children. With this surge comes the need for dedicated services helping with specific issues of inheritance. Wealth managers are establishing clients’ goals of shared values over their wealth and how the family can manifest these values through the generations.

 See Stacy Perman, Penta Millionaires: The New Rising Class, Barron’s, September 17, 2016.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.

September 20, 2016 in Current Events, Estate Planning - Generally | Permalink | Comments (0)

Monday, September 19, 2016

First Minor Granted Euthanasia in Belgium

EuthenasiaTwo years ago, Belgium rescinded the age restrictions on euthanasia, and now, the first terminally ill minor has been assisted to die. Currently, Belgium is the only country that allows minors to be assisted in dying. The law, however, is quite strict, requiring the minor to be in the final stages of terminal illness; understand rationally the difference between life and death; and ask to end their life on repeated occasions. Additionally, another requirement for these minors is to have parental consent along with the consent of two doctors. Not surprisingly, this law comes with much opposition. 

See Belgium Sees First Case of Minor Being Granted Euthanasia, Fox News, September 17, 2016.

September 19, 2016 in Current Events, Death Event Planning, New Legislation | Permalink | Comments (0)

Critics Outrage Over Spending of Thrifty Librarian's Bequest

Robert morinRecently, a librarian, Robert Morin, bequeathed his $4 million estate to his alma mater, the University of New Hampshire, but critics are now unsatisfied with the way the university has chosen to spend the cash. A large portion—$1 million to be exact—will go toward a new scoreboard at the football stadium; a use that the school says represents Morin’s love for football in the last fifteen months of his life. Others, however, see this spending at odds with the frugal librarian’s life while the library only receives a tenth of that sum.

See Ben Guarino, University to Buy Football Scoreboard with Thrifty Librarian’s Money, Outraging Critics, Independent, September 16, 2016.

Special thanks to Joel Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.

September 19, 2016 in Current Events, Estate Administration, Estate Planning - Generally, Sports | Permalink | Comments (0)

ACTEC Launches YouTube Video Series: "ACTEC Family Estate Planning Guide"

ACTECThe American College of Trust and Estate Counsel (ACTEC) is launching the first two in a series of YouTube videos briefs created to offer the public insight into the fundamentals of wills and trusts. The ACTEC Family Estate Planning Guide provides essential information to help families protect their financial interests.

The series debuts with two 10-minute talks presented by ACTEC Fellows and Elder Law experts Bernard A. Krooks and Professor Mary F. Radford who speak to a live audience highlighting common questions and worse case scenarios that illustrate the value of preparing an estate plan customized to the needs of a family. The speakers offer insights targeted to help families plan and protect their assets and personal well-being and explain terms to help viewers engage in an informed discussion with their lawyer or advisor.

"The video series gives ACTEC a platform to address frequently-asked questions and share the vast experience of our practitioners directly with consumers," said ACTEC President Cynda C. Ottaway. "ACTEC members serve a spectrum of clients - from individuals of modest wealth to large family businesses with complex interests – and our goal is to offer an educational resource to encourage planning for families of any means."

September 19, 2016 in Current Events, Elder Law, Estate Planning - Generally | Permalink | Comments (0)