Wills, Trusts & Estates Prof Blog

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

A Member of the Law Professor Blogs Network

Tuesday, May 26, 2015

Three Documents Every 18 Year Old Should Have

Alicecooper18It is always a good idea to plan ahead for not only your client, but also your client’s children.  When a client’s child turns 18 they should have a will, healthcare power of attorney, and property power of attorney.  It makes good business sense for an estate planner to build a working relationship with not only his or her client but also the client’s children since they will be inheriting many of the assets that you helped make plans for.  It is true that 18 year old individuals do not often have a lot of property or assets, but it is still important to plan for unexpected medical emergencies by having a will and naming a person who would have power of attorney.

See David H. Lenok, What Documents Do Your Clients 18-Year-Old-Children Need?, Trusts & Estates, May 26, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

May 26, 2015 in Current Affairs, Disability Planning - Health Care, Disability Planning - Property Management, Estate Planning - Generally, Wills | Permalink | Comments (0) | TrackBack (0)

Trustee Motions For New Payment Plan To Compensate Victims

GavelA court appointed bankruptcy trustee who is managing the funds of the now bankrupt Life Partners Holdings has filed a motion for a new payment plan.  H. Thomas Moran II was appointed in March to serve as trustee after Life Partners Holdings filed for chapter 11 bankruptcy.  The Waco based company had lost to the SEC and had a $46 million judgment imposed against it.  Moran claims that the LPH has been ripping off investors for a long period of time.  The Trustee would like to pay off defrauded investors by utilizing the cash surrender value and premium reserves that are on hand.

See David Lee, Trustee Wants To Use Assets For Victims, Courthouse News Service, May 26, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

May 26, 2015 in Current Affairs, Estate Planning - Generally, Trusts | Permalink | Comments (0) | TrackBack (0)

District Court Overturns Bankruptcy Court’s Living Trust Decision

Jay adkissonA recent decision by the U.S. District Court for the Northern District of Illinois has overturned a bankruptcy court in a case involving the estate of Linda Castellano.  The District Court has decided that the Bankruptcy court improperly held that a Living Trust created by Linda could be reverted back to her bankruptcy estate at her death and be subject to the claims of creditors.  The Court held that under Bankruptcy Code section 541(c)(2) the living trust was excluded from Linda’s estate.  The Trust did not terminate at Linda’s death “but continued to live a vibrant existence even as of the time that Linda commenced her bankruptcy case.” 

A lot of problems would have been created with living trusts if the District Court would have upheld the Bankruptcy Court’s judgment.  The original ruling was overly expansive and could have caused almost all living trusts to be set aside as “self-settled trusts.”   This decision creates more certainty in the interpretation of section 541(c)(2), a section which is still open to much interpretation. 

See Jay Adkisson, Estate Planning Bar Breathes Sigh Of Relief As Castellano Gets Turned Around, Forbes, May 25, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.     

May 26, 2015 in Current Affairs, Estate Planning - Generally, Trusts | Permalink | Comments (0) | TrackBack (0)

Article On Changes In American Funeral Industry

Tanya MArshTanya D Marsh (Associate Professor, Wake Forest School of Law) recently published an article entitled, A New Lease on Death, 49 Real Property, Probate and Trust Law Journal 421-451 (2015). Provided below is an excerpt from the article:

Changes in the American funeral industry have sparked a new category of land use — a business where funeral goods and services are sold, but human remains are not embalmed, stored, or displayed. The author has named this new land use a “retail funeral establishment.” Many of these establishments are seeking to locate in retail areas, particularly multi-tenant shopping centers across the country. This new land use raises challenges for real estate attorneys regarding whether retail funeral establishments are permitted in retail developments pursuant to public and private land use controls.

May 26, 2015 in Articles, Death Event Planning, Estate Planning - Generally | Permalink | Comments (0) | TrackBack (0)

How To Avoid Retirement Pain After A Sudden Disability

Wheel ChairThe risk of disability from an unexpected injury is a sad but ever-present fact of life; when it strikes near retirement it can lead to stark financial decisions. Many people opt to dip into savings to cover the unexpected expenses from the injury or illness in addition to maintaining their standard of living. Then, the remaining investments tend to be moved into low risk, and low yield, retirement plans which further pressures the health of the savings. Instead, keep retirement funds in plans that outpace inflation and slash expenses with anticipatory cuts if it is clear that a standard of living downgrade is inevitable. This strategy will help prevent the loss of retirement money down the line and put the individual in control of the new circumstances.

See Kyle Krull, When a Disability Derails Your Retirement Plans, Wealth Managements, May , 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

May 26, 2015 in Disability Planning - Health Care, Disability Planning - Property Management, Estate Planning - Generally | Permalink | Comments (0) | TrackBack (0)

Monday, May 25, 2015

Major Estate Disputes That Have Been Reported On

New bb kingThere have been a few high profile estate disputes that have involved major celebrities and people of interest.  The estates of BB King, Michael Jackson, Leona Helmlsey, Ted Williams, Nelson Mandela, Nina Wang, and Liliane Bettencourt have all been subject to high profile disputes over a wide variety of issues.  These problems range from disputes over things like inheritance, guardianship, pet trusts, mental capacity, power of attorney, and what to do with a body after death.  These highly reported on celebrity disputes bring attention to the wide range of problems that poor estate planning can cause.  It shows the complex factors that a wise estate planner needs to account for when creating wills and trusts and helping a client plan for their future. 

See The who’s who battle for wills, bodies, and legacies, BBC News, May 24, 2015.

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

May 25, 2015 in Current Affairs, Death Event Planning, Disability Planning - Health Care, Elder Law, Estate Planning - Generally, Trusts, Wills | Permalink | Comments (0) | TrackBack (0)

What Are The Best Countries To Live in For Different Financial Needs?

TransportFor individuals with different financial needs there are advantages to living in certain
countries. When it comes to certain unique types of financial situations here are the 6 best places to live in:

  1. Best Pension System: Denmark.  According to the Mercer Global Pension Index (MGPI) Denmark has the best pension system in the world. 
  2. Cheapest Place To Live: Saudi Arabia.  The Economists Intelligence Unit (EIU) has released a cost-of-living survey listing Riyadh and Jeddah as being the two cheapest cities in the world to live in.
  3. Highest Disposable Income: United States.  According to an OECD study the United States ranks highest in the amount of money each household spends on goods and services.
  4. Lowest Income Tax: Dubai. The best country in the world to live in to avoid income taxes is Dubai, where people get to keep 100% of their income.
  5. Cheapest childcare: Australia.  According to a recent OECD study on childcare costs Australia has the most affordable child care options for parents.
  6. Lowest Death Costs: Australia and New Zealand.  The inheritance tax was abolished in Australia and New Zealand a number of years ago making those two nations the best countries to live in to avoid such taxes.

See Louise McBride, Best places for tax- live in Dubai, die in Australia, Independent, May 25, 2015. 

Special thanks to Jim Hillhouse for bringing this article to my attention.


May 25, 2015 in Current Affairs, Estate Planning - Generally, Estate Tax, Income Tax | Permalink | Comments (0) | TrackBack (0)

Understanding the New Qualified Longevity Annuity Contract Regulations

Understand-and-implement71-crop-600x338It is important for retirees to know about how to use the new regulations on Qualified Longevity Annuity Contracts (QLACs).  These contracts are essentially “wrappers” that house deferred income annuities (DIAs).  This can permit individuals to delay payments to fill potential income needs that might come up later in life.  There are several income options that a person can choose from, QLACs offer clients more flexibility than what a traditional retirement plan might have given. 

In order to be successful a QLAC should take a holistic approach which factors in the client’s individual life needs.  It is good to consult with a proper tax advisor to work out a plan because a QLAC is “not a transactional sale, but more of a planning-based sale.”  Be creative when working with a client, create a plan that best suits their individual financial needs. 

See Anthony Tocco, Understanding and implementing QLACs in a retirement plan, Life Health Pro, May 22, 2015.

Special thanks to Jim Hillhouse for bringing this article to my attention.

May 25, 2015 in Current Affairs, Elder Law, Estate Planning - Generally, Income Tax | Permalink | Comments (0) | TrackBack (0)

What Are Required Minimum Distributions During Retirement?

RetirementA person can find out what the required minimum distributions (RMDs) from a retirement plan are by visiting the IRS website and using the “Uniform Lifetime Table.”  Most people use the Uniform Lifetime Table to calculate their RMDs.  It is important to start taking RMDs on the Required Begin Date (RBD).  A person cannot begin taking RMD’s from a retirement plan, like an IRA or 401(k), until at least April 1 of the year following the calendar year in which that person reached the age of 70½. 

See Robert Powell, How much will my distributions be in retirement?, USA Today, May 23 2015. 

May 25, 2015 in Current Affairs, Elder Law, Estate Planning - Generally | Permalink | Comments (0) | TrackBack (0)

For Ultra Wealthy Clients Consider Setting Up A Family Foundation

PhilanthropyFor families with vast wealth, there is often an impulse to use the money to further the various philanthropic causes family members might have. A wide variety of methods exist to bring these plans into action and one that should be considered is the family foundation. While these are expensive to establish, it offers the benefit of being able to control the direction of the charity and making the family feel connected to the beneficial acts that are being done in their name. When an individual has reached the pinnacle of their field, legacy often becomes a key motivating factor and a family foundation gives them the chance to pass their ideals down to the next generation in a way that will help others.

See Russ Alan Prince, The Appeal Of Family Foundations, Forbes, April 30, 2015.


May 25, 2015 in Estate Planning - Generally, Wills | Permalink | Comments (0) | TrackBack (0)