Wills, Trusts & Estates Prof Blog

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

Saturday, August 20, 2016

Wildenstein Mansion Relisted for $100 Million

WildensteinIn 2014, the Wildensteins, a billionaire art dealing family, decided to sell their 21,000-square-foot townhouse in New York, acting as their art gallery. They agreed to sell the townhouse for $90 million to the Qatar government, which would give them some liquidity for dealing with their $500 million tax case in France. Qatar ended up pulling out of the deal one day before closing, citing violation of money laundering laws by the Wildensteins. After suit was filed, the Wildensteins claimed that Qatar reneged on the deal due to being uncomfortable over the publicity of the record-breaking sale price. The case was settled out of court in May 2016, and the townhouse was taken off the market. Now, the townhouse is back of the market listed for $100 million or a long-term lease. This property is one of several that the Wildensteins are trying to unload; however, they are not selling any artwork for their pending tax case.

See James Tarmy, Scandal-Plagued Wildenstein Mansion Back on Market for $100 Million, Bloomberg, August 17, 2016.

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

August 20, 2016 in Current Events, Estate Planning - Generally, New Cases, Trusts | Permalink | Comments (0)

Article on Prudent Investor Rule for Financial Advisers

Prudent investor ruleMax M. Schanzenbach & Robert H. Sitkoff recently published an Article entitled, Financial Advisers Can’t Overlook the Prudent Investor Rule, J. Financial Planning (2016). Provided below is an abstract of the Article:

This article calls attention to the Department of Labor’s imposition of the “prudent investor rule” on financial advisers to retirement savers. This article also canvasses the customary role of an investment policy statement in promoting compliance with the prudent investor rule by professional fiduciaries.

In April 2016, the Department of Labor promulgated a rule that imposes on financial advisers to retirement savers “fiduciary” status under the Employee Retirement Income Security Act. The Department reasoned that the fiduciary duty of loyalty was necessary to protect retirement savers from conflicted investment advice. But in addition to a duty of loyalty, ERISA fiduciary status also imposes a duty of care or prudence. And with respect to investment management, the fiduciary standard of care is governed by the “prudent investor rule.” The basic tenets of the prudent investor rule are grounded in modern portfolio theory. In short, the prudent investor rule requires diversification and an overall investment strategy having risk and return objectives reasonably suited to the purpose of the investment account.

August 20, 2016 in Articles, Estate Planning - Generally, Professional Responsibility | Permalink | Comments (0)

Friday, August 19, 2016

Section 2704 Proposed Regulations on Transfer Tax

Transfer taxThe section 2704 new proposed regulations may be the most significant regulations in the transfer tax area in a long time, resulting in substantial restrictions on valuation discounts for transfers of interests in family entities. Please click here for a detailed analysis of the Section 2704 proposed regulations and planning implications. 

August 19, 2016 in Current Events, Estate Planning - Generally, Generation-Skipping Transfer Tax, New Legislation | Permalink | Comments (0)

Book on International Estate Planning

International estate planning book Barbara Hauser recently published a book entitled, International Estate Planning: A Reference Guide (Updated September 2015). Provided below is a summary of the book:

International Estate Planning: A Reference Guide, is a practical and authoritative resource for those seeking key information in the estate planning field. Practitioners and foreign advisers, whose clients have assets, children, parents or a spouse in other countries, or whose tax liabilities are difficult to define because of nationality, employment, or residence issues, and U.S. executives working in foreign countries will find straightforward, useful information in this guide. Equipped with a companion CD the appendix to the book contains copies of fillable tax forms and notices, relevant treaties and Hague conventions, as well as a list of organizations and resources to quickly help the reader obtain the answers they need. 

August 19, 2016 in Books, Books - For Practitioners, Estate Planning - Generally | Permalink | Comments (0)

Proceeds Go to Named Beneficiaries Not Later Will Bequests

Life insurance1In Collister v. Feller, a Washington court of appeal concluded that a man who was named as his ex-wife’s beneficiary on her life insurance policy is not required to distribute proceeds to later beneficiaries named in her will. A testator can only direct the distribution of life insurance proceeds to be payable to the testator, estate, or personal representative. The ex-husband in this case was named as the personal representative, and the will was not eligible to direct proceeds.

See Julianne Tobin Wojay, Named Beneficiary Trumps Testator’s Later Bequest, Bloomberg, August 11, 2016.

Special thanks to Naomi Cahn (Harold H. Greene Professor of Law, George Washington University School of Law) for bringing this article to my attention.

August 19, 2016 in Estate Planning - Generally, Non-Probate Assets, Wills | Permalink | Comments (0)

CLE on International Trust & Estate Planning in Washington, D.C.

CLEThe American Law Institute is hosting a CLE entitled, 19th Annual ALI CLE Advanced Course of Study on International Trust and Estate Planning, which will take place on October 27–28, 2016, at the Washington Plaza Hotel in Washington, D.C. at 10 Thomas Circle. Provided below is a description of the event:

The two-day program provides an in-depth review of the factors to consider when providing tax and estate planning advice to wealthy individuals and families with U.S. and foreign contacts. Some of this year’s important topics include:

  • U.S. tax rules applicable to foreign “grantor” and “non-grantor” trusts
  • Common Law trusts and their analogues in other legal systems
  • Trust and related tax law developments outside the United States
  • Practical advice for clients with foreign trusts and business interests
  • Update of current multinational initiatives impacting cross-border wealth and tax planning
  • New options for international charitable planning and related developments
  • S. immigration and citizenship rules relevant to estate planning
  • The current “mark-to-market” expatriation tax rules, including the proposed section 2801 “inheritance” tax regulations
  • The effect that the international exchange of beneficial owner information embedded in CRS and FATCA is likely to have on cross-border tax and estate planning

As in past years, the course’s distinguished faculty will use interactive panels to address the latest wealth planning strategies and trends. There will be ample time to discuss your questions with the faculty and to network with them and a national audience of your peers.

August 19, 2016 in Conferences & CLE, Estate Planning - Generally, Estate Tax, Trusts | Permalink | Comments (0)

Thursday, August 18, 2016

A Good Death

Good deathWe may never know what the future holds for our death; however, in its progression, experts argue that our nation’s nursing home and medical system play a role in attempting to add days with little consideration for the quality of those days. The argument is for quality over quantity, making our last days less miserable and frightening. A recent study has outlined the factors that contribute to a “good death,” including being pain free, feeling at peace, and dying in an ideal location for the patient. The ultimate goal “is not a good death, but a good life to the very end.” 

See David G. Allan, A ‘Good Death’ by Going Gentle into That Good Night, CNN, August 16, 2016.

August 18, 2016 in Death Event Planning, Estate Planning - Generally | Permalink | Comments (1)

Article on Arkansas's Approach to the Elective Share

Elective share1Maria Korzendorfer recently published a Case Note entitled, In re Estate of Thompson: The Shortcomings of the Arkansas Elective Share Statute, 68 Ark. L. Rev. 1089 (2016). Provided below is a summary of the Case Note:

The majority opinion in Thompson illustrates the extent to which the Arkansas Supreme Court will go to protect the inheritance rights of a surviving spouse. While an equitable result was achieved in Thompson, the use of extensive and costly litigation to show an intentional circumvention of spousal rights is both infeasible for many surviving spouses and judicially inefficient. In light of Thompson, and because of the potential misapplication of the intent-to-defraud test -- combined with the apparent disconnect between the state's elective share statute, equitable distribution statute, and Premarital Agreement Act -- the time is ripe for Arkansas to adopt the Uniform Probate Code's (UPC) augmented estate approach for calculating the elective share. Such reform would reduce litigation and increase predictability, two of the most important goals of estate planning. Further, it would better comport with existing law, promote Arkansas's public policy favoring spousal protection, and ensure against windfalls for surviving spouses.

This note addresses the problems inherent in Arkansas's approach to the elective share and recommends statutory intervention in the wake of Thompson. Part II details pertinent Arkansas caselaw, the facts of Thompson, and explains why the court reached its holding and how this is consistent with Arkansas law. Part III analyzes both Arkansas's method of calculating the elective share and the UPC's augmented estate approach. Part IV compares the two elective share methods, illustrates the disconnect between Arkansas's elective share and other areas of state law, and shows the timeliness of Arkansas adopting the augmented estate approach to provide predictability in estate planning while remaining consistent with long-standing Arkansas public policy.

August 18, 2016 in Articles, Estate Planning - Generally | Permalink | Comments (0)

New Jersey Allows Disinheritance Based on Religion

Religion confli tA New Jersey appeals court in In re Estate of Kenneth E. Jameson recently held that the law does not bar an individual from disinheriting their child for religiously discriminatory reasons. The case centered on a will contest by a woman who was disinherited from her Catholic father’s will after dating and later marrying a Jewish man.

See Howard Friedman, New Jersey Appeals Court OKs Religiously Discriminatory Disinheritance, Religion Clause, August 15, 2016.

Special thanks to Naomi Cahn (Harold H. Greene Professor of Law, George Washington University School of Law) for bringing this article to my attention.

August 18, 2016 in Current Events, Estate Planning - Generally, New Cases, Religion, Wills | Permalink | Comments (0)

The Rise of the British Inheritance Tax

Inheritance taxSince 2010, the British inheritance tax bill has risen by more than 90%, becoming a general tax on middle England. The Treasury has become increasingly dependent on this tax, nearly doubling its proportionate share of the overall taxman’s income. This realization will call for the Conservatives to cut the inheritance tax quicker than anticipated in the general election. Under the new proposed system, families will be allowed to pass £1 million onto their children inheritance tax free.

See Ben Riley-Smith, Inheritance Tax Bill Has Nearly Doubled Since Tories Took Power, Figures Show, Telegraph, August 15, 2016.

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

August 18, 2016 in Current Events, Estate Planning - Generally, Estate Tax | Permalink | Comments (0)