Wills, Trusts & Estates Prof Blog

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

Wednesday, June 20, 2018

Lessons to Take from Stan Lee's Experiences

SpiderWhat is (allegedly) occurring to Stan Lee, the mastermind behind beloved Marvel characters such as Fantastic Four and Spiderman, is unmistakable as heartbreaking. Lee's daughter, 67-year-old J.C., is a "financially irresponsible individual who spends anywhere from $20,000 to $40,000 a month on credit cards," and who has "demanded alterations to a trust set up for her," according to The Hollywood Reporter. A Los Angeles court issued a temporary restraining order on June 13 against Keya Morgan, a memorabilia collector who allegedly became a caregiver after Mr. Lee's wife died. Hearing, vision and memory impairments mean Lee is unable to "resist undue influence" when it comes to the management of his more than $50 million fortune.

Though estate planning usually focuses on the distribution of assets and wealth after the death of a client, but as elder-financial-abuse shifts to be prominent in the public eye, issues of aging and later-life planning could become more vital.

One "very powerful" thing advisers can facilitate for older clients is consolidation of their financial accounts, Mr. Shenkman said the founder of an eponymous law firm. Also, revocable trusts can be beneficial to hinder financial abuse of elder clients according to Beth Shapiro Kaufman, president of the law firm Caplin & Drysdale. 

In the case of Stan Lee, personal trustees are difficult to come by. "Mr. Shenkman recommends using a professional, independent trustee or a group of co-trustees to serve as a protective measure. Clients can also appoint a 'trust protector' — someone who has the right to change trustees if there's impropriety or who can demand an accounting from the trustee."

See Greg Iacurci, Stan Lee: Estate Planning Takeaways from the Marvel Legend's Elder-Abuse Saga, Investment News, June 15, 2018.

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

June 20, 2018 in Current Affairs, Elder Law, Estate Administration, Estate Planning - Generally, Guardianship, Trusts | Permalink | Comments (0)

8 Estate Planning Moves If You Are Getting Divorced

DivorceDivorces can be messy They can be emotionally tiring with numerous decisions to be made. Before the divorce is finalized, your spouse still has several legal rights, but you would like to maintain as much control over your assets as possible. Also, if you happen to pass away or become incapicitated before that finalization, there are things that you can do to upold that command. Here are 8 estate planning suggestions to add to your divorce to-do list

  • Update your healthcare proxy.
  • Change your power of attorney.
  • Find out what you can and cannot alter.
    • Such as 401(k), pensions, or life insurance policies.
  • Update your will.
  • Decide what to leave your spouse.
    • After it is all said and done, you may decide not to completely disinherit your soon-to-be ex-spouse.
  • Look at your prenuptial (or postnuptial) agreement
  • Amend your trust.
  • Revisit the plan after your divorce is finalized.

See Christine Fletcher, 8 Estate Planning Moves If You Are Getting Divorced, Forbes Magazine, June 19, 2018

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

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

June 20, 2018 in Disability Planning - Health Care, Estate Planning - Generally, Trusts, Wills | Permalink | Comments (0)

Tuesday, June 19, 2018

Article on "Adoptions Shall Not be Recognized": the Unintended Consequences for Dynasty Trusts

AdoptKristine S. Knaplund published an Article entitled, "Adoptions Shall Not be Recognized": the Unintended Consequences for Dynasty Trusts, 7 UC Irvine L. Rev. 545-577 (2017). Provided below is an abstract of the Article.

A benefactor establishes an irrevocable trust for the benefit of her children, grandchildren, and future descendants, with the express provision that “adoptions shall not be recognized.” Years later, the settlor’s daughter and her husband, using a donated ovum and the husband’s sperm, hire a gestational carrier to carry the child to term. A California court declares the daughter to be the mother, although she is genetically and biologically unrelated to the child. Is the child a beneficiary of the trust? In In re Doe, a New York court struggled with this issue, one likely to arise again as multi-generational trusts collide with new ways of creating children. This Article will for the first time explore the interpretation of dynasty trusts established either when courts presumed the settlor intended to exclude adoptees as beneficiaries or with express language excluding adoptees. Assisted insemination, in vitro fertilization, the use of gestational carriers, and the abolition of the Rule Against Perpetuities in many jurisdictions have combined to vastly complicate the interpretation of old trusts and the drafting of new ones. If these old presumptions or the new express language are applied literally to children conceived through assisted reproductive technologies (ART), the result will be to exclude many children the settlor would likely intend to be included, while including others that logically should be omitted. The main thesis of this Article is that ART children must be viewed through a different lens than those conceived coitally in order to carry out the trust settlor’s intent. In addition to proposing methods for courts to interpret language in trusts created decades before assisted reproductive techniques, this Article will recommend language to be included in the drafting of new trusts.

Part II of this Article will briefly discuss the common law rationale that class terms such as “children” or “descendants” invariably meant those related by blood, and that once American states enacted legislation formalizing adoptions in the mid-nineteenth century, “adoptees” were not related to the transferor by blood. Part III explores two key changes in the twentieth century: the increase in multi-generational trusts due to alterations in the tax code and in the Rule Against Perpetuities, and more recently, scientific advances that allow embryos to be created and transferred outside the body. Part IV examines current law on whether adoptees are included in class gifts in wills and trusts, and then proposes two solutions to deal with children of assisted reproduction: how to draft language in new trusts and how to interpret language in decades-old trusts. Part V concludes the Article.

June 19, 2018 in Articles, Current Affairs, Estate Planning - Generally, Trusts | Permalink | Comments (0)

How the Rich Can Dodge Trump’s Property Tax Hike

NycWith the passage of the Tax Cuts and Jobs Act, a hotly contested provision within the Act was creating a $10,000 limit on federal deductions for state and local taxes, or SALT, such as property taxes. The greatest effect will be felt in states with higher taxes such as New Jersey, New York, and Connecticut.

Creating multiple non-grantor trusts - trusts that are treated as independent taxpayers - is one method to bypass the limit on tax deductions. First you must set up an LLC in a no-tax state such as Alaska or Delaware, then transfer interests of the assets subject to the SALT into the LLC. After that, transfer fractions of the LLC into the multiple non-grantor trusts. Each trust can then take the maximum $10,000 deduction.

This process is too burdensome and time-consuming for the uber wealthy; but for those that have who have property taxes totaling up to $100,000, tax experts say this is a highly beneficial method to save on taxes.

See Lynnley Browning, How the Rich Can Dodge Trump’s Property Tax Hike, Bloomberg, June 15, 2018.

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

June 19, 2018 in Current Affairs, Estate Planning - Generally, Income Tax, New Legislation, Trusts | Permalink | Comments (0)

CLE on Trusts 101

CLEThe National Business Institute is holding a conference entitled, Trusts 101, on Monday, August 06, 2018 at the Hilton Garden Inn Tulsa Midtown in Tulsa, Oklahoma. Provided below is a description of the event:

Program Description

Provide your clients with the full spectrum of wealth preservation options.

When assessing complex information, it often helps to break items into basic building blocks. The same approach can be successful when dealing with asset protection. Be prepared for specific challenges associated with various types of trusts by understanding their unique characteristics. Our intensive full-day primer will provide you with a comprehensive overview of the wide variety of trusts available. Register today!

  • Determine what role the settlor will play by weighing the pros and cons of establishing an irrevocable trust over a revocable trust.
  • Learn what not to do when selecting and drafting a revocable trust to avoid common mistakes.
  • Learn how to choose the most beneficial vehicle for preserving your client's wealth: understand the purpose behind the various types of irrevocable trusts.
  • Explore the powers and duties of personal representatives in irrevocable trusts.
  • Save money on taxes with effective use of defective trusts.
  • Learn why it's important to know when to file the tax return for grantor trusts.
  • Determine whether a client qualifies as a beneficiary of a special needs trust.
  • Don't reinvent the wheel - modify our sample trust documents and use our drafting tips to create airtight trusts.

Who Should Attend

This basic level seminar is designed for the professionals involved in creating, administering and terminating trusts:

  • Attorneys
  • Accountants and CPAs
  • Trust Officers
  • Financial Planners
  • Tax Professionals
  • Paralegals

Course Content

  1. Where to Begin? - An Overview of Trusts
  2. Revocable Living Trusts
  3. Trusts Used for Tax Reduction
  4. Grantor Trusts
  5. Estate Planning for the Disabled
  6. Ethical Considerations

Continuing Education Credit

Continuing Legal Education – CLE: 8.00 *

Financial Planners – Financial Planners: 8.00

International Association for Continuing Education Training – IACET: 0.70

National Association of Legal Assistants, Inc. – NALA: 6.60 *

National Association of State Boards of Accountancy – CPE for Accountants/NASBA: 8.00 *

National Federation of Paralegal Associations, Inc. – NFPA

Professional Achievement in Continuing Education – PACE: 8.00

* denotes specialty credits

June 19, 2018 in Conferences & CLE, Estate Planning - Generally, Estate Tax, Generation-Skipping Transfer Tax, Income Tax, Trusts | Permalink | Comments (0)

Monday, June 18, 2018

Albany Attorney Admits to Stealing from Elderly Clients in $11.8 Million Estate Fraud

image from https://s3.amazonaws.com/feather-client-files-aviary-prod-us-east-1/2018-06-18/49b0d7c2-9794-46c1-a045-ee9732c86791.pngRichard J Sherwood, 58, pled guilty last week to money laundering and tax crimes stemming from a scheme to steal millions from estates of elderly clients that he was serving as attorney and fiduciary. Between Sherwood and his co-conspirator they stole a total of $11.8 million from an elderly couple, the wife's sister, and a client from Ohio that suffered from dementia.

Sherwood had been a practicing attorney in New York since 1988, primarily in the field of trusts and estates. He became the attorney for the couple of Warren and Pauline Bruggeman in 2006, as well as Pauline's sister Anne Urban, all of Niskayuna, New York. They all signed will directing the majority of their assets to be transferred to charities upon their deaths.

"Warren Bruggeman died in April 2009, and Pauline died in August 2011. At the time of her death, Pauline had personal and trust assets valued at approximately $20 million." Anne Urban passed away not long after in 2013. The conspirarcy also included the grabbing of funds from Julia Rentz, a resident of Ohio, who was suffering from dementia at the time of the thefts and died in 2013 as well.

Sherwood faces up to 20 years in prison, a maximum fine of $250,000, and up to 3 years of post-imprisonment supervised release. He also served as Guilderland Town Justice from 2014 until his arrest on February 23, 2018. He resigned his position on March 5.

See Albany Attorney Admits to Stealing from Elderly Clients in $11.8 Million Estate Fraud, US. Attorney's Office, Northern District of New York, June 11, 2018.

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

June 18, 2018 in Current Events, Elder Law, Estate Planning - Generally, Professional Responsibility, Trusts, Wills | Permalink | Comments (0)

Saturday, June 16, 2018

CLE on Estate Planning from A to Z

CLEThe National Business Institute is holding conference entitled, Estate Planning from A to Z, on Tuesday, June 26, 2018, at the Sheraton Wilmington South Hotel in New Castle, Delaware. Provided below is a description of the event:

Program Description

A Detailed Overview of the Estate Planning Procedure and Strategy

Do you have all the knowledge and skills you need to draft tailored testamentary documents and minimize taxable estate for each of your clients? This comprehensive course will become your ultimate guide to estate planning. You will receive tips, sample forms and answers to your most pressing questions to help you excel. Get the latest knowledge on effective will and trust planning techniques - register today!

  • Stave off conflicts of interest with a clear determination of who your client is from the start.
  • Get practical will and trust drafting skills to speed up the process and give the testator's last wishes power.
  • Minimize the taxable estate with effective tax planning techniques.
  • Explore the functions and mechanics of major trust structures - and make certain you choose the right tool for each job.
  • Make sure your remarried and unmarried clients know the default inheritance laws and help them make sure the right beneficiaries are assigned.
  • Help your clients make the tough medical decisions regarding long-term care, end-of-life and organ donation.

Who Should Attend

This basic-to-intermediate level seminar is designed for:

  • Attorneys
  • Estate and Financial Planners
  • Trust Officers
  • Paralegals
  • Accountants

Course Content

  1. Client Screening and Intake
  2. Key Elements of Effective Wills
  3. Basic Tax Planning
  4. Documenting Long-Term Care, Incapacity and End-of-Life Decisions
  5. Trusts 101
  6. Planning for Unmarried and Remarried Couples
  7. Ethical Considerations

Continuing Education Credit

Continuing Legal Education

Credit Hrs State
CLE 6.00 -  DE*
CLE 7.20 -  NJ*
CLE 6.00 -  PA*

Financial Planners – Financial Planners: 7.00

National Association of State Boards of Accountancy – CPE for Accountants/NASBA: 7.00 *

* denotes specialty credits

June 16, 2018 in Conferences & CLE, Death Event Planning, Estate Planning - Generally, Estate Tax, Gift Tax, Guardianship, Trusts, Wills | Permalink | Comments (0)

Friday, June 15, 2018

Book on Selected Statutes on Trusts and Estates, 2018

Statute bookMark L. Ascher & Grayson M.P. McCouch recently published a a book entitled, Selected Statutes on Trusts and Estates, 2018 ed. (2018). Provided below is some information about the book:

This casebook statutory supplement meets the needs of students in basic and advanced courses on wills, trusts, decedents' estates, fiduciary administration, and future interests, providing a compendium of essential uniform act provisions and official comments. It covers a wide range of topics, including: intestacy; wills; probate administration; nonprobate transfers; disclaimers; principal and income; prudent investments; perpetuities; trusts (including trust decanting and directed trusts); powers of appointment; and powers of attorney. The previous edition has been updated to include the recently-promulgated Uniform Directed Trust Act and related conforming amendments.

June 15, 2018 in Books - For Practitioners, Estate Planning - Generally, Guardianship, Intestate Succession, Non-Probate Assets, Trusts, Wills | Permalink | Comments (0)

Wednesday, June 13, 2018

CLE on Estate Administration Boot Camp

The National Business Institute is holding a 2-day conference entitled, Estate Administration Boot Camp, on Wednesday, June 20, 2018 -Thursday, June 21, 2018, at Holiday Inn Colorado Springs Airport in Colorado Springs, Colorado. A description of the event is provided below:

Program Description

Everything You Need to Know about Effectively Administering an Estate

Are you fully confident in your knowledge of the latest court and tax rules and the most effective transfer tools to ensure each client's estate is laid to rest according to the decedent's wishes, with minimal tax burden? This comprehensive 2-day instruction will give you all the skills you need to administer estates that include trusts and/or business interests without a hitch. Register today!

  • Don't miss any crucial notice and filing requirements when opening the estate - learn what must be done right away.
  • Get helpful forms and checklists that will help you in administration.
  • Understand how income and estate tax deductions interact and find the most advantageous way to structure the tax returns
  • Learn how to use disclaimers more effectively.
  • Clarify what must be done when the trust becomes irrevocable.
  • Protect your professional reputation with a practical legal ethics guide focused on trusts and estates practice.
  • Prevent mistakes in final petition and ensure each estate is closed quickly and without disputes.

Who Should Attend

This two-day, basic level seminar is designed for:

  • Attorneys
  • Accountants/CPAs
  • Tax Professionals
  • Financial Planners
  • Trust Officers/Administrators/Managers
  • Paralegals

Course Content

DAY 1

  • Forms of Administration and When They are Used
  • First Steps and Notices, Executor Duties, Opening the Estate
  • Key Intestacy Laws You Must Know
  • Marshalling the Assets
  • Spouse Elective Share and Disclaimers
  • Trusts that Affect Estate Administration
  • Legal Ethics in Estate Administration

DAY 2

  • Income Tax Returns
  • Portability and Estate, Gift, GST Taxes
  • Handling Distributions
  • Business Interests in Estate Administration
  • Handling Debts and Claims Against the Estate
  • Closing the Estate and Final Accounting
  • Estate and Trust Contests, Disputes, Challenges

Continuing Education Credit

Continuing Legal Education – CLE: 14.00 *

International Association for Continuing Education Training – IACET: 1.20

National Association of State Boards of Accountancy – CPE for Accountants/NASBA: 14.00 *

* denotes specialty credits

June 13, 2018 in Conferences & CLE, Estate Administration, Estate Planning - Generally, Estate Tax, Generation-Skipping Transfer Tax, Gift Tax, Income Tax, Intestate Succession, Trusts, Wills | Permalink | Comments (0)

Tuesday, June 12, 2018

Thirteen Estate Planning Tips for Beneficiaries with Special Needs

image from https://s3.amazonaws.com/feather-client-files-aviary-prod-us-east-1/2018-06-12/7fe72ee7-d970-4f1c-97db-acd39740d003.pngEstate planning for individuals that have children or other types of beneficiaries with disabilities is wrought with extra layers of complexity. Those individuals are usually primary caretakers for their loved ones and worry about who will take care of them after the caretaker has passed away. Here are tips on what to do to make the caretaker's death an easier transition for the person with disabilities.

  • Draft a Letter of Intent to lay out instructions for trustees, guardians, and other's about the special needs person's likes, dislikes, habits, routines, etc.
  • Start a Special Needs Trust (SNT), or sometimes called a Supplemental Needs Trust, for the loved one's benefit during the caretaker's lifetime rather than their will.
  • Avoid court-appointed management and caretakers.
  • Consider allotting more funds for the beneficiary with the special needs to other beneficiaries that may not have the same requirements.
  • Consider life insurance to adequately fund the SNT especially if the family is newer and the beneficiary with disabilities is young.

More tips can be found in the article.

See Robert M. Freedman & Alexis R. Gruttadauria, Thirteen Estate Planning Tips for Beneficiaries with Special Needs, Wealth Management, May 9, 2018.

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

June 12, 2018 in Current Affairs, Estate Administration, Estate Planning - Generally, Guardianship, Trusts | Permalink | Comments (0)