Wills, Trusts & Estates Prof Blog

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

Thursday, October 8, 2015

How Clients Should Approach Medicaid Planning

MedicaidThis column discusses a unique area of the law that is known as “Medicaid planning.”  This type of planning requires clients to look for ways to maximize means-tested Medicaid benefits.  One of the most common ways to maximize Medicaid benefits is through “income reduction” techniques that often involve creating a Qualified Income Trust (QIT).  These QITs are often referred to by many in the legal community as “Miller Trusts” after a court case that authorized this technique.  There are also various special needs trusts that clients can set up to save assets without breaching the income requirements needed to maintain Medicaid eligibility.  In order to take advantage of these financial planning techniques it is a good idea to consult with a professional estate planning attorney. 

See Kyle Krull, What Do My Clients Need to Know About Medicaid Planning (for Starters, Anyway)?, Wealth Management, October 7, 2015.

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

October 8, 2015 in Elder Law, Estate Administration, Estate Planning - Generally, Guardianship, Income Tax, Trusts | Permalink | Comments (0)

Steps Clients Should Take Before Retirement

4 things retirementThe decisions that a person makes in the critical years leading up to retirement can have a tremendous impact on the level of comfort that person enjoys in retirement.  This column discusses some of the biggest financial-planning issues that clients will face when preparing for retirement.  Clients need to understand the difference between revocable and irrevocable choices.  They will need to consider which assets they want to spend and when they would want to spend them. 

It is very important to think about ways of diversifying investments to gain tax benefits.  Clients need to be aware of how their benefits will affect the heirs and beneficiaries that will inherit them.  It is a good idea to speak with an estate planning professional to come up with an individualized retirement plan that fits with the clients unique circumstances.

See Jane Hodges, The 4 Things to Do Before Retirement, The Wall Street Journal, October 4, 2015.

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

October 8, 2015 in Elder Law, Estate Planning - Generally, Income Tax, Trusts, Wills | Permalink | Comments (0)

The Benefits Of Setting Up A Strategic Philanthropic Plan

Strategic_philanthropyPhilanthropic giving is currently on the rise in the United States currently accounting for 2% of Gross Domestic Product (GDP).  People often want to give back to society, but it is not always easy to know where to begin when it comes to setting up a philanthropic plan.  There are a wide ranging number of choices people have when it comes to charitable giving.  People need to use caution and be strategic about what the best plan is for their own unique financial circumstances.  This column provides a step-by-step process that people should consider when coming up with a strategic plan for philanthropic giving.  It is extremely important for clients to be informed about the different options and fully aware of the goals that they are trying to accomplish.

See John Tennaro, Strategic Philanthropy: A Higher Quality of Giving, Atlantic Trust Blog, October 7, 2015.

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

October 8, 2015 in Estate Planning - Generally, Estate Tax, Trusts | Permalink | Comments (0)

How Clients Can Use A NING Trust To Avoid Certain State Taxes

MonopolyThis column discusses how clients can use a Nevada Incomplete Non-Grantor (NING) Trust to avoid having to pay state income taxes.  A NING is a powerful tax planning tool that has actually been approved in a series of recent IRS private-letter rulings.  Not everyone can benefit from a NING, and it is important to use extreme care and caution when structuring such a financial device.  The Trustee of a NING Trust must be a Nevada resident, or they must live in a state that has a similar asset protection trust statute to the one in Nevada.  There are other limitations to these types of trusts discussed in this column.  Clients should consult with a professional estate planner to weigh the pros and cons of getting a NING trust. 

See Neil E. Schoenblum, Eliminating Income Tax and Protecting Assets With a NING Trust, Accredited Investor Markets, October 8, 2015.

October 8, 2015 in Estate Planning - Generally, Income Tax, Trusts | Permalink | Comments (0)

Wednesday, October 7, 2015

Court Holds That Power Of Attorney Did Not Grant Authority To Create Trust

Power-of-AttorneyThere has been an increasing amount of litigation about the scope of power that is conveyed to an agent through a power of attorney.  An appellate court in Kentucky has recently weighed into this power of attorney issue in Dishman v. Dougherty.  One of the main things to take away from the Kentucky Court opinion is that a power of attorney did not authorize the attorney-in-fact to create a trust.  In order for an attorney-in-fact to create a trust that authority must be expressly authorized in the power of attorney instrument if it contains a provision related to trusts.  In this specific case the power of attorney only permitted the attorney-in-fact to convey property into a trust, it did not permit him to create a trust.  Estate planners should be familiar with the local rules and regulations dealing with powers of attorney.  

See Luke Lantta, Power Of Attorney Did Not Authorize Creation Of Trust, Bryan Cave Fiduciary Litigation, October 7, 2015.

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

October 7, 2015 in Current Affairs, Estate Planning - Generally, Trusts | Permalink | Comments (0)

Hall Of Fame Baseball Player Brooks Robinson Will Sell Personal Collection Through Heritage Auctions

Brooks robinsonBaseball Hall of Fame player Brooks Robinson, who is considered to be the greatest third-baseman to ever play, is going to sell his personal collection through Heritage Auctions.  The online only auction will be held on November 5-7, 2015, and all proceeds from the auction will go to The Constance & Brooks Robinson Charitable Foundation.  Chris Ivy, Director of Sports Auctions at Heritage considers this to be one of "most significant player collections" the auction house ever put on sale.  Brooks Robinson had a storied career for the Baltimore Orioles that lasted for 23 years.  This column lists many of the collectors items that will be sold along with the estimated value of each item.  

See Hall of Fame third baseman Brooks Robinson to sell his personal collection through Heritage Auctions, Art Daily, October 7, 2015. 


October 7, 2015 in Current Affairs, Estate Planning - Generally, Sports | Permalink | Comments (0)

Being A Caregiver Can Impact Career

CaregivingA recent study conducted by Genworth shows that being a caregiver can have a significant toll on career prospects. In a survey of 1,200 caregivers more than half said that providing care for a loved one has negatively impacted their career and about 11 percent claim to have lost a job.  One of the biggest problems is that people are not doing enough to plan ahead for the possibility of needing long term care.  Many people don't want to discuss these sensitive and difficult topics with their family, but it is extremely important to come up with a plan ahead of time to avoid a crises down the road.  People need to be prepared for the financial and emotional challenges that long term caregivers experience.  

See The Career Cost of Caregiving, Wealth Management, October 5, 2015. 

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

October 7, 2015 in Current Affairs, Elder Law, Estate Planning - Generally, Guardianship | Permalink | Comments (0)

Considerations To Keep In Mind When Facing Choice To Cash Out Pension

MoneyDespite their decline, pensions still exist and many people are faced with a decision when given the option to cash it out for a lump sum. For some, the prospect of a huge cash payout can be too much to resist. But factors must be taken into consideration such as the following:

  • The stability of the pension fund should be a key consideration. A pension that looks to have future troubles might make the lump sum worth taking if there are other, safer investments that offer comparable rates of return.
  • Look at the growth that can be expected from the pension. If monthly payments only increase a small percentage year to year, then a lump sum that would make better returns invested elsewhere could be an attractive change for the financially aggressive.
  • Does the pension continue only for life or are heirs able to take an interest in remaining principle when the beneficiary dies? A lump sum payment might work better for those that have short life expectancies who will be unlikely to collect over time the amount they could take via a one time payout.

See Ken Moraif, How to decide whether to take a pension or a lump sum, Market Watch, October 6, 2015.

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

October 7, 2015 in Estate Planning - Generally, Non-Probate Assets | Permalink | Comments (0)

Tuesday, October 6, 2015

How Single Clients Should Deal With Estate Planning

SavingsAmericas singles population has been growing lately and a majority of the U.S. population that is over 15 is single.  There are certain important steps that single people need to take in regards to estate planning.  When a single person dies intestate State law determines how their assets are distributed.  It is extremely important for clients to have a Will if they want their intentions for how they want their property distributed carried out.  Finding a trustworthy person to designate with the power of attorney is also crucial.  Clients should also be proactive about making sure insurance, IRA, and any other retirement accounts have clearly named beneficiaries.  Make sure to also have any desired health care directives put in writing.  Single clients should speak with an estate planning attorney about coming up with an individualized estate plan that will accommodate their needs.

See Shoshanna Delventhal, Estate Planning for Single Individuals, Investopedia, October 6, 2015.


October 6, 2015 in Estate Planning - Generally, Estate Tax, Intestate Succession, Trusts, Wills | Permalink | Comments (0)

Scaife Estate Claims To Have Overpaid State Estate Tax By $10 Million

Richard-ScaifeI have previously discussed the dispute over the estate of the late Tribune-Review Publisher Richard Scaife.  The Estate has filed a tax return with the State of Pennsylvania claiming that the estate overpaid the State's estate tax by $10 million.  According to accountants for the estate the tax payments amounted to $104.7 million, but that a year-long review that they did on the estate shows that they should have only paid $94.5 million.  This current estate tax dispute is separate from many of the other legal actions that the Scaife estate is involved in.  The Scaife estate was worth about $830 million and about according to the tax return about $630 of that was subject to tax.  Because of the large size of this estate there will likely be more future developments to this story.  

See Mike Wereschagin, Scaife estate overpaid state taxes by $10M, return filed Monday states, Trib Live News, October 5, 2015. 



October 6, 2015 in Current Affairs, Estate Planning - Generally, Estate Tax, Trusts, Wills | Permalink | Comments (0)