Wills, Trusts & Estates Prof Blog

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

Monday, September 24, 2018

CLE on New Tax Basis Reporting Requirements in Estate Administration

CLEThe National Business Institute is holding a teleconference entitled, New Tax Basis Reporting Requirements in Estate Administration, on Wednesday, November 7, 2018, at 11:00 a.m. - 12:30 pm. Central. Provided below is a description of the event:

Program Description

Are You Following the New Tax Rules?

The way tax basis of assets is reported during estate administration has changed. Are you confident in your knowledge of the basis consistency rules to ensure every estate is administered correctly? Clarify the new rules and get practical tax-saving tips from experienced faculty - register today!

  • Compare the new basis consistency rules and the old law.
  • Adopt your tax planning and reporting practices to reflect the new requirements.
  • Determine what asset valuation method to use for basis reporting purposes.

Who Should Attend

This tax law update is designed for attorneys. It will also benefit accountants and CPAs, estate planners, trust officers, and paralegals.

Course Content

  • New Basis Consistency Rules vs. the Old Law
  • What Executors/Personal Representatives Need to Know NOW
  • New Information That Must be Included
  • Valuation of the Assets for Basis Reporting Purposes
  • Reporting to Beneficiaries

Continuing Education Credit

Continuing Legal Education

Credit Hrs State
CLE 1.50 -  AK
CLE 1.50 -  AL
CLE 1.50 -  AR
CLE 1.50 -  AZ
CLE 1.50 -  CA*
CLE 1.50 -  CO
CLE 1.50 -  CT
CLE 1.50 -  DE
CLE 2.00 -  FL*
CLE 1.50 -  GA
CLE 1.50 -  HI
CLE 1.50 -  IA
CLE 1.50 -  ID
CLE 1.50 -  IL
CLE 1.50 -  IN
CLE 1.50 -  KS
CLE 1.50 -  KY
CLE 1.50 -  LA
CLE 1.50 -  ME
CLE 1.50 -  MN
CLE 1.80 -  MO
CLE 1.50 -  MP
CLE 1.50 -  MS
CLE 1.50 -  MT
CLE 1.50 -  NC
CLE 1.50 -  ND
CLE 1.50 -  NE
CLE 1.50 -  NH
CLE 1.80 -  NJ
CLE 1.50 -  NM
CLE 1.50 -  NV
CLE 1.50 -  NY*
CLE 1.50 -  OH
CLE 2.00 -  OK
CLE 1.50 -  OR
CLE 1.50 -  PA
CLE 1.50 -  RI
CLE 1.50 -  SC
CLE 1.50 -  TN
CLE 1.50 -  TX
CLE 1.50 -  UT
CLE 1.50 -  VA
CLE 1.50 -  VT
CLE 1.50 -  WA
CLE 1.50 -  WI
CLE 1.80 -  WV
CLE 1.50 -  WY

Continuing Professional Education for Accountants

Credit Hrs State
CPE for Accountants 1.50 -  AZ
CPE for Accountants 1.50 -  NY
CPE for Accountants 1.50 -  WA
CPE for Accountants 1.50 -  WI

Financial Planners – Financial Planners: 1.50

National Association of State Boards of Accountancy – CPE for Accountants/NASBA: 1.50 *

* denotes specialty credits

September 24, 2018 in Conferences & CLE, Estate Administration, Estate Planning - Generally, Estate Tax, Generation-Skipping Transfer Tax, Gift Tax, Income Tax, New Legislation, Trusts, Wills | Permalink | Comments (0)

Sunday, September 23, 2018

Article on Arbitration Contracts Between Trustees and Their Investment Agents: a Warning Label

TrusteesCharles E. Rounds, Jr. recently published an Article entitled, Arbitration Contracts Between Trustees and Their Investment Agents: a Warning Label, 93 N.D. L. Rev. 263-275 (2018). Provided below is an abstract for the Article.

This Article considers whether arbitration clauses in contracts between trustees and their investment managers are binding on the trust beneficiares.Nowadays, it is default law that a trustee may delegate investment discretion to an investment manager (IM); provided the IM has been prudently selected by the trustee and the IM’s activities are prudently monitored on an ongoing basis by the trustee. The core relationship is one of agency, the trustee being the principal and the IM being the agent. The two, as well, are in a contractual relationship incident to the agency. The IM, however, also owes fiduciary duties that run directly to the trust beneficiaries, though the beneficiaries are parties neither to the agency nor the contract. These duties are imposed separately by equity. Assume the beneficiaries bring an action directly against the IM for breaching one or more of his or her equitable duties to them. Should the trust beneficiaries be bound at law by the arbitration clause in the contract between the trustee and the IM? The Article concludes that they should not be; but if they are then the trustee could well have been in breach of his or her equitable duty of undivided loyalty to the beneficiaries by having acquiesced to the clause’s insertion in the first place. And as to the IM, he or she, under general equitable principles, may well have a fiduciary duty to the beneficiaries to waive his or her rights at law to have the dispute arbitrated, at least to the extent that it is in the interests of the beneficiaries that he or she does so.

September 23, 2018 in Articles, Estate Administration, Estate Planning - Generally, Trusts | Permalink | Comments (0)

Saturday, September 22, 2018

CLE on Estate Planning for Farmers and Ranchers

CLEThe National Business Institute is holding a conference entitled, Estate Planning for Farmers and Ranchers, on Wednesday, November 14, 2018, at the Hilton Garden Inn North Little Rock in North Little Rock, Arkansas. Provided below is a description of the event:

Program Description

How to Protect Farm Assets and Transfer Them to Heirs

Estate planning for farms and ranches requires specialized knowledge and tools to ensure the best client representation. This legal course will give you the knowledge to preserve the farms and other assets your clients have worked their entire lives to acquire and build. Explore the challenges and opportunities unique to estate planning for farmers to help make good sense of difficult legal and financial policies. Learn what you need to know about estate taxes, wills, trusts, government programs, and other key elements. Help your clients take care of their estate planning needs and their family's future - register today!

  • Take full advantage of government farm programs and valuation discounts.
  • Explore the deciding factors in choosing the right business entity when planning ownership transfer.
  • Analyze the liquidity of farm assets and augment each plan accordingly.
  • Employ all available tools for transferring assets and preserving wealth.
  • Tackle harvest yield predictions and other unique factors of farm asset valuation.
  • Recognize when giving away the farm is the wisest financial decision and how to do it properly.

Who Should Attend

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

  • Attorneys
  • Estate and Financial Planners
  • Accountants and CPAs
  • Tax Preparers
  • Trust Officers
  • Paralegals

Course Content

  1. Business Structure Choice and Conversion - Including Sample Documents
  2. Income and Gift Tax Planning
  3. Medicaid (Long-Term) Planning for Farmers and Ranchers
  4. Planning for a Full or Partial Outright Sale or Gift
  5. Agricultural Use Valuation
  6. Planning for a Gradual Transfer Within the Family
  7. Transfers Upon Death: Key Estate Administration Concerns

Continuing Education Credit

Continuing Legal Education – CLE: 6.00

Financial Planners – Financial Planners: 7.00

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

* denotes specialty credits

September 22, 2018 in Conferences & CLE, Disability Planning - Property Management, Estate Administration, Estate Planning - Generally, Trusts, Wills | Permalink | Comments (0)

Giant Firm Finds Proof is in the Principles

BibleRonald Blue Trust, a former registered investment advisor, converted to a trust company after joining Thrivent Trust Company, owned by Thrivent Financial, in 2017. Ronald Blue is based in Atlanta and has more than 8,000 clients, 13 office locations, and $8 billion in assets under advisement, and is based on socially responsible investment principles. The company steers away from tobacco, alcohol and gambling investments.

“We envision a world where Christians are more confident, content and living their God-given callings in service to one another, their churches and their communities,” according to Thrivent’s website. The firm’s principles-based framework has proven to be successful in helping clients achieve their goals over the long term, said Brian McClard, director of Ronald Blue Trust’s Investment Strategy Group.

The firm’s principle of uncertainty states that the future is uncertain; therefore planning, saving and investing are inherently important. The principle is guided by the belief that God created humans with the tools necessary to steward the world’s limited resources. Ron Blue Trust has partnered with Church Law & Tax, a publication of Christian Today, to provide content for ChurchSalary, a tool developed as a result of the National Initiative to Address Economic Challenges Facing Pastoral Leaders — an initiative to improve faith leaders’ financial confidence.

See Jadah Riley, Giant Firm Finds Proof is in the Principles, Financial Advisor, September 6, 2018.

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

September 22, 2018 in Current Affairs, Estate Planning - Generally, Trusts | Permalink | Comments (0)

Friday, September 21, 2018

Burt Reynolds Left His Only Son Out of His Will and Created a Trust for Him Instead

BurtquinnBurt Reynolds included a statement in his will stating that his son, Quinn, will not be receiving anything from his will. It read that, when it came to his son, “I intentionally omit him from this, my Last Will and Testament, as I have provided for him during my lifetime in my Declaration of Trust.”

Reynolds died earlier this month at age 82. Quinton, born in 1988, was the adopted son of Reynolds and his ex-wife Loni Anderson. At the time of his death, Reynolds was reportedly worth $5 million.

The will, which was signed in 2011, appoints Reynolds’ niece Nancy Lee Brown Hess as the personal representative of Reynolds’ estate. Hess said in a statement, “My uncle was not just a movie icon; he was a generous, passionate and sensitive man who was dedicated to his family, friends, fans and acting students.” She said that his death was highly unexpected, and that Reynolds "was looking forward to working with Quentin Tarantino (in Once Upon a Time in Hollywood) and the amazing cast that was assembled.”

See Emily Zauzmer, Burt Reynolds Left His Only Son Out of His Will and Created a Trust for Him Instead, People, September 18, 2018.

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

September 21, 2018 in Current Events, Estate Planning - Generally, Film, Television, Trusts, Wills | Permalink | Comments (0)

Thursday, September 20, 2018

CLE on The Proposed § 199A Regulations and Multiple Trust Rules: What Estate Planners Need to Know

CLEThe American Law Institute is holding a webcast / teleconference entitled, The Proposed § 199A Regulations and Multiple Trust Rules: What Estate Planners Need to Know, on Wednesday, October 17, 2018, at 12:00 p.m. - 1:30 p.m. Eastern. Provided below is a description of the event:

Why You Should Attend

In conjunction with a massive tax cut for C corporations, 2017 tax reform enacted Internal Revenue Code § 199A, providing owners of pass-through entities, such as S corporations, partnerships (including LLCs), and sole proprietorships, with a deduction of up to 20% of their qualified business income. Whether one receives the deduction and how much it is depends on a variety of factors. In addition to the law needing clarification, several commentators suggested ways to avoid limitations that reduce the deduction – ways the IRS viewed as abusive.   Proposed regulations released in August fill in many details and close perceived loopholes. Join us to learn how the proposed regulations inform business structuring, when the deduction is available and when it is not, how to try to work within the rules to maximize the deduction, the effect of basis on the deduction and the government’s position on when basis step-up helps and when it does not, the desirability of shifting income to get a better result, and how the deduction works for trusts and informs our planning for them.  

What You Will Learn

A faculty of highly experienced estate planners will review the basic rules for context and summarize ACTEC’s comments on the proposed regulations. They will then dive into the complexities of:   

How optional aggregation can help those who have set up multiple entities for their business

How activities associated with specialized service trades or businesses can become tainted

How changes in basis may or may not affect the § 199A deduction

Planning for trusts to maximize the § 199A deduction

How the scope of the multiple trust rules under § 643(f) affects trust planning (even when the § 199A deduction is not involved)

Who Should Attend

This webcast from ALI CLE and ACTEC will benefit any estate planner, but particularly those who advise sole proprietorships, partnerships, and S corporations.

September 20, 2018 in Conferences & CLE, Current Affairs, Estate Planning - Generally, New Legislation, Trusts | Permalink | Comments (0)

Wednesday, September 19, 2018

No-Contest Clause Upheld by the Wyoming Supreme Court With No Probable Cause Exception

WritingwillA no-contest clause essentially makes all gifts under the will or trust conditional upon not challenging the document, and the practice of including one is becoming increasingly popular in American society. Blended families may have a higher chance of disagreements and squabbles over inheritances, as beneficiaries may have varying levels of gifts.

Trust and estate litigation is frequently driven by emotion, and often times the beneficiary’s complaints are not rational, thus corresponding litigation can severely tap into the estate's assets and funds. This is what the settlor is typically trying to avoid by the use of a co-contest clause. The Wyoming Supreme Court recently held in EGW and AW v. First Federal Savings Bank of Sheridan, 413 P.3d 106 (Wyo. 2018) that a no-contest does not violate public policy in Wyoming. 

The Court ruled that a “testator has the right to grant bequests subject to any lawful conditions he or she may select.” In the opinion, the Court explains that the ability to relinquish a person's property in the way they so choose is a strongly held right, and one that is backed by the full power of the law. The Court also found that even with challenge is in good faith and with probable the no-contest clause is still enforceable. Many states allow challenges made with probable cause to be brought in spite of a no-contest clause, a principal that is set forth in § 3-905 of the Uniform Probate Code, but Wyoming did not adopt that section of the Code.

See Carol Warnick, No-Contest Clause Upheld by the Wyoming Supreme Court With No Probable Cause Exception, Fiduciary Law Blog, September 12, 2018.

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

September 19, 2018 in Current Events, Estate Planning - Generally, New Cases, Trusts, Wills | Permalink | Comments (0)

Section 199A — Qualified Business Income Deduction Including Highlights of Proposed Regulations

TaxreformSteve R. Akers recently published a summary of Section 199A entitled, Section 199A — Qualified Business Income Deduction Including Highlights of Proposed Regulations, Bessemer Trust, September 11, 2018. Provided below is an abstract of the summary.

Section 199A is an important provision in the 2017 Tax Act, permitting a 20% deduction for qualified business income from proprietorships or passthrough entities, subject to complicated limitations. Proposed regulations were issued on August 8, 2018 (184 pages of preamble and regulations!) for Sections 199A and 643(f) (regarding the multiple trust rule).

The proposed regulations provide substantial additions for administering the statutory provisions (some of which ar taxpayer-friendly and some of which are not). A few highlights include:

  • Exceptions for "self-rental" property (as to the trade or business requirement) and for management companies (as to the W-2 limitation);
  • Prohibitions on "cracking and packing" strategies (regarding limitations on the deduction for "specified service trades or businesses"); and
  • Anti-abuse rules for trusts owning business interests

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

Tuesday, September 18, 2018

Judge Rules Hawaiian Princess Unfit to Manage $215m Trust

Hawaii-county-mapThe last "princess" Hawaii, a descendant of the Hawaiian royal family that was overthrown in 1893, has been found to not possess sufficient capacity to manage her $215 million trust. Abigail Kawānanakoa, 92, is also the great-granddaughter of James Campbell, a sugar plantation owner that was one of Hawaii's largest landowners, and whom Kawānanakoa inherited much of her fortune from.

Kawānanakoa was known locally to be quiet and private, but also would lend a hand to many in need by paying people's bills and mortgages. In 2001, the heiress also established a $100m trust aimed at supporting Native Hawaiian language, culture, art, education, health and housing. “At the moment, she is a benefactor for the Hawaiian people,” said Lilikalā Kame’eleihiwa, director and professor at the University of Hawaii’s Center for Hawaiian Studies and a board member for Kawānanakoa’s trust.

But Kawānanakoa had a stroke last year and allegedly began to act "out of character." She married her girlfriend of over two decades, Veronica Gail Worth, and fired her attorney, Jim Wright after he claimed she was no longer able to serve as a trustee. Kawānanakoa hired new representative, Michael Lilly, and told a judge in Honolulu that she desired to remove Wright and appoint new trustees, including her wife.

The judge on Monday removed Wright as trustee, but appointed First Hawaiian Bank in his place. He said that he believed Kawānanakoa was able to decide that she wanted a trustee replaced, but that it was more complicated to appoint someone new, and that he didn’t find her capable of managing her financial assets.

See Breena Kerr, Judge Rules Hawaiian Princess Unfit to Manage $215m Trust, The Guardian, September 15, 2018.

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

September 18, 2018 in Current Events, Estate Administration, Estate Planning - Generally, New Cases, Trusts | Permalink | Comments (1)

Monday, September 17, 2018

CLE on Using Trusts and LLC Together in Estate Planning

CLEThe National Business Institute is holding a live video webcast entitled, Using Trusts and LLC Together in Estate Planning, on Tuesday, October 30, 2018, at 9:00 a.m. - 4:00 p.m. Central. Provided below is a description of the event:

Program Description

Enhancing Your Estate Plans by Combining Top Techniques

Make the best use of the two most effective and versatile estate planning instruments: trusts and LLCs. This practical legal guide will help you determine the best course of action for each client's unique situation, and implement your plan impeccably. Register today!

  • Stay up to date on the tax rules governing the participation of trusts in a business.
  • Ensure the transfer of an LLC into a trust goes off without a hitch.
  • Get the best prevention and resolution techniques for disputes most likely to arise.

Who Should Attend

This legal guide is designed for attorneys. It will also benefit accountants, estate planners, trust officers, business owners, and paralegals.

Course Content

  1. Material Participation by Trusts: Complying with the Tax Rules
  2. Using Asset Protection Trusts and LLCs Together
  3. The Intentionally Defective Grantor Trusts (IDGTs) and LLCs
  4. Transferring an LLC to a Trust (with Sample Documents)
  5. Trustees and Other LLC Members: Duties, Powers, and Decision-Making
  6. What to Do When the Trust Terms Conflict with the Interests of the LLC Members
  7. Transfers and Dissolution Issues
  8. Legal Ethics

Continuing Education Credit

Continuing Legal Education

Credit Hrs State
CLE 6.00 -  AK*
CLE 6.00 -  AL*
CLE 6.00 -  AR*
CLE 6.00 -  AZ*
CLE 6.00 -  CA*
CLE 7.00 -  CO*
CLE 6.00 -  CT*
CLE 6.00 -  DE*
CLE 7.00 -  FL*
CLE 6.00 -  GA*
CLE 6.00 -  HI*
CLE 6.00 -  IA*
CLE 6.00 -  ID*
CLE 6.00 -  IL*
CLE 6.00 -  IN*
CLE 7.00 -  KS*
CLE 6.00 -  KY*
CLE 6.00 -  LA*
CLE 6.00 -  ME*
CLE 6.00 -  MN*
CLE 7.20 -  MO*
CLE 6.00 -  MP
CLE 6.00 -  MS*
CLE 6.00 -  MT*
CLE 6.00 -  NC*
CLE 6.00 -  ND*
CLE 6.00 -  NE*
CLE 6.00 -  NH*
CLE 7.20 -  NJ*
CLE 6.00 -  NM*
CLE 6.00 -  NV*
CLE 7.00 -  NY*
CLE 6.00 -  OH*
CLE 7.00 -  OK*
CLE 6.00 -  OR*
CLE 6.00 -  PA*
CLE 7.00 -  RI*
CLE 6.00 -  SC*
CLE 6.00 -  TN*
CLE 6.00 -  TX*
CLE 6.00 -  UT*
CLE 6.00 -  VA*
CLE 6.00 -  VT*
CLE 6.00 -  WA*
CLE 7.00 -  WI*
CLE 7.20 -  WV*
CLE 6.00 -  WY*

Continuing Professional Education for Accountants

Credit Hrs State
CPE for Accountants 7.00 -  AZ
CPE for Accountants 7.00 -  NY*
CPE for Accountants 7.00 -  WA
CPE for Accountants 7.00 -  WI

 * denotes specialty credits

September 17, 2018 in Conferences & CLE, Estate Administration, Estate Planning - Generally, Income Tax, New Legislation, Trusts | Permalink | Comments (0)