Sunday, December 8, 2013
Johann K. Brunner (University of Linz - Department of Economics, CESifo (Center for Economic Studies and Ifo Institute for Economic Research)) and Susanne Pech (University of Linz - Department of Economics) recently published an article entitled, Taxing Bequests and Consumption in the Steady State, CESifo Working Paper Series No. 4453 (October 31, 2013). Provided below is the abstract from SSRN:
We study the optimal tax system in a dynamic model where differences in wages induce differences in inheritances, and the transition from parent ability to child ability is described by a Markov chain. We characterize expected inheritances in the steady state and show that the Atkinson-Stiglitz result on the redundancy of indirect taxes does not hold in this framework. In particular, given an optimal income tax, a bequest tax as well as a consumption tax are potential instruments for additional redistribution. For the bequest tax the sign of the overall welfare effect depends on the reaction of bequests and on inequality aversion, while for the consumption tax the sign is always positive because the distorting effect is outweighed by the induced increase in wealth accumulation. A necessary condition for a positive welfare effect is the empirically validated relation that more able individuals on average have more able parents than less able individuals.
Wednesday, November 20, 2013
As I have previously discussed, Bavarian customs police recently found a cache of paintings by well-known artists in the home of Cornelius Gurlitt.
Cornelius inherited the paintings from his father, art dealer Hildebrand Gurlitt, who bought the “degenerate art” after it was confiscated by the Nazis. The families of Jewish collectors whose artworks were confiscated are now very interested in what kind of man Cornelius really is.
The reclusive Gurlitt could have legal claim to many of the artworks under Germany’s 30-year statute of limitations and the rule of “Ersitzung,” whereby the possessor of property gains title after ten years unless the possessor is deemed to have acted in bad faith. If the 80-year-old Gurlitt refuses to negotiate, these heirs will be forced to fight for the art in court, where they will have little chance of success.
Gurlitt has poven amenable to negotiating with the artwork’s original owners. In 2011, Gurlitt sold Max Beckmann’s “Lion Tamer” for 864,000 Euros. When the heirs of a Jewish art dealer claimed the painting, Gurlitt shared the proceeds with them.
See Alex Webb & Catherine Hickley, Nazi Loot Heirs Look to Reclusive Hoarder to Recover Art, Bloomberg, Nov. 13, 2013.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
Sunday, November 10, 2013
If you come into a sudden windfall, you need to consider strategies to protect your newfound wealth. Here are six asset protection strategies that will help shield your wealth:
- Increase liability insurance. Before receiving the windfall, increase your personal umbrella liability coverage to an amount equal to your net-worth.
- Keep assets separate. If you have children from a previous marriage or are contemplating a divorce, it’s best not to commingle assets.
- Protect yourself from tenants. If you have rental property, create a business entity to shield your other assets from disgruntled tenants.
- Reconsider jointly-held accounts. Any money in a joint account is at risk if the joint owner divorces, incurs a tax lien, or is subject to a lawsuit judgment.
- Formalize informal partnerships. Form an entity such as an LLC or corporation that will provide you with greater legal protection.
- Create business entities. If you operate a sole proprietorship, all of your personal assets are at risk. Shield personal assets from lawsuits by creating a business entity.
See Robert Pagliarini, 6 Asset Protection Strategies to Shield Your Wealth, Chicago Tribune, Nov. 5, 2013.
Sunday, November 3, 2013
One of India’s wealthiest and most important families, the Gaekwads of Baroda, have finally settled a 23-year-long dispute over an estimated fortune of £3 billion.
After the 1998 death of Maharaja Fetehsinghrao Gaekwad, his younger brother Ranjitsinh succeeded him but another brother, Sangramsinh, claimed he was entitled to a half share of the estate. Ranjitsinh’s heir, Maharaja Samarjitsinh Gaekwad, launched negotiations to settle the lengthy dispute. Under the settlement, the new Maharaja of Baroda will retain the lion’s share of the estate, which includes one of the country’s most luxurious palaces, the imposing Laxmi Vilas Palace.
See Dean Nelson, Baroda Maharaja Settles £3 Billion Inheritance Feud, The Telegraph, Oct. 24, 2013.
Friday, October 25, 2013
Mirea Ioana Mirela (Independent) recently published an article entitled, Notary Public’s Authority in the Successional Procedure Matter, Pro Patria Lex Journal of Legal Studies and Research, Vol. XI, No. 1 (22)/2013. Provided below is the abstract from SSRN:
Inheritance law can be defined as all the legal rules which regulate the rights transmission from mortis causa. The substance of the succession comprises all the rules regulating the assets transmission of the deceased to his heirs . Civil Law gives to the Notary Public an essential role in inheritance law, offering non‐contentious alternative of probate cases debate.
Sunday, October 13, 2013
Joseph Carroll (University Beasley School of Law) has recently published an article entitled, Avoiding Backlash: The Exclusion of Domestic Partnership Language in the 2008 Amendments to the Uniform Probate Code and the Future for Same-Sex Intestacy Rights, 85 Temp. L. Rev. 623-653 (2013). Provided below is the introduction to the article:
The gay rights movement has achieved remarkable momentum in recent years, resulting in the dismantling of Don’t Ask, Don’t Tell, the passage of same-sex marriage laws in nine states and the District of Columbia, and a series of judicial decisions striking down key parts of the Defense of Marriage Act. Despite this progress, same-sex equality is far from complete. Gays and lesbians remain, in many ways, second-class citizens who are frequently denied important rights and benefits by virtue of their sexual orientation. This Comment focuses on one of these rights—inheritance—and the efforts to secure it through reform of the Uniform Probate Code (UPC).
The UPC is one of the most influential uniform laws promulgated by the Uniform Law Commission (ULC). Its purpose, like other uniform law projects, is “to make uniform the law among the various jurisdictions,” in this case the law of probate. Uniformity is accomplished “only by passage of law in fifty state legislatures.” Surprisingly, many commentators neglect to consider this somewhat self-evident requirement when making recommendations to reform the UPC, most recently in the context of same-sex inheritance rights. This Comment will address some of the arguments raised in favor of reforming the most recent version of the UPC in 2008 and examine why language recognizing same-sex relationships was properly excluded.Section II of this Comment provides a history of the uniform law system, the evolution of the UPC, and the various proposals to reform it by providing for same-sex inheritance rights. Section III describes why the UPC is an inappropriate vehicle through which to achieve the objectives regarding same-sex inheritance rights and argues for a more state-based approach, using Hawaii’s Reciprocal Beneficiaries System as a model. Finally, Section IV concludes that while gays and lesbians rightfully deserve full intestate succession benefits, reforming the UPC is not currently the appropriate method by which to do this and would ultimately weaken the uniform law system as a whole.
Friday, October 11, 2013
As I have previously discussed, Anthony J. Allegrino II recently submitted a will for legal review, claiming he was the sole beneficiary of Staten Island developer Roman Blum’s estate, who supposedly died intestate.
Now, an elderly Polish woman named Teresa Musial has sent a certified copy of Blum’s purported will to the surrogate court, claiming she is the heir to his fortune. Counsel to the public administrator doubts either will is valid. If they are invalid, the state of New York would inherit Blum’s $40 million fortune.
See Ryan Lavis, Polish Woman Makes a Claim to $40M Estate of Reclusive Staten Island Developer, Staten Island Advance, Oct. 9, 2013.
Monday, September 23, 2013
Staten Island developer Roman Blum supposedly died intestate last year at age 97, leaving the largest unclaimed estate in New York history to the tune of $40 million.
However, a will has now been submitted for legal review in the Surrogate Court of Richmond County by named sole beneficiary, Anthony J. Allegrino II, a New Windsor attorney reportedly disbarred in at least one state. Because New York stands to receive the estate, the initial hearing has been pushed back to October 8 to allow the state attorney general to be present.
The submitted will comes as a surprise to Blum’s longtime friend and attorney Robert Fishler who said, “If he was going to do a will, I would have known about it.”
See Ryan Lavis, Upstate Man, Claiming to Be Sole Heir to Staten Island Developer’s $40M Fortune, Files Will in Court, Staten Island Advance, Sept. 19, 2013.
Friday, September 20, 2013
According to a recent survey by Interest.com, only 27% of those ages 18-59 expect to receive an inheritance from their parents or family members. And about half of those who do believe they will receive an inheritance believe it’ll be under $100,000.
But according to Derek Gabrielsen from Strategic Wealth Partners, these people may be too pessimistic. Because the baby boomer generation is expected to be the largest wealth transfer in American history, he estimates over half of those 73% nonbelievers will receive some kind of inheritance.
See Martha C. White, After Recession, Few Americans Expect to Inherit Money, CNBC, Sept. 17, 2013.
Special thanks to David S. Luber (Florida Probate Attorney) for bringing this article to my attention.
Jamie Baxter (Dalhousie University - Schulich School of Law, Yale University - Law School) recently published an article entitled, Legal Institutions of Farmland Succession: Implications for Sustainable Food Systems, Wills, Trusts, & Estates Law eJournal, Vol. 9, No. 25 (Sept. 18, 2013). Provided below is the abstract from SSRN:
The legal institutions relevant to farmland succession — defined as the transfer of property in and control over farmland — are increasingly important determinants of sustainable environmental outcomes on modern farms. The history of farmland succession has been written, by and large, through extra-legal processes of transfer and inheritance between generations of close family relations. This familiar “family farm” model, however, is rapidly being replaced by succession arrangements between non-relatives, often strangers, with entrant farmers from non-agricultural backgrounds. As a growing number of current farmers retire and seek creative ways to transfer control and ownership of their farms, the availability and content of property arrangements on farmlands acquire a new significance. The resulting formalization of farmland succession places greater demands on policy makers to craft farmland tenure options and supporting institutions that are suitable to a wider diversity of needs, particularly among small farmers, and to consider the impacts of these arrangements for sustainable food systems over the long term.