Wills, Trusts & Estates Prof Blog

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

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Friday, May 29, 2015

Expecting An Inheritance? Depends On Country, Which Parent Legacy Is Coming From.

InheritanceA recent survey by HSBC has revealed interesting differences between attitudes of men and women when it comes to inheritance. The study found that women were more concerned about maintaining some assets to hand down to the next generation while men who were more inclined to spend everything before death. The country of residence also played a part in attitudes about inheritance as the people living within an advanced economy were more inclined to spend it all than leave anything to their descendants. This report goes to show that attitudes about inheritance are wide ranging and every estate planner should know if a client wants their last ever check to bounce or pass down a sizable to bequest to loved ones.

See Laura Shin, Survey: Whether To Leave An Inheritance Or Spend It All Varies By Gender, Country, Forbes, May 28, 2015.

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

May 29, 2015 in Estate Planning - Generally, Wills | Permalink | Comments (0)

Woman Accused Of Altering Stepfathers Will

WillsA Tamarac, Florida woman has been accused of forging portions of her stepfather's will in addition to forging signatures of family members. The women left herself an expensive recreational vehicle and had her step father sign a quit claim deed to the family homestead. The judge has set bond at $100,000 and would require the wearing of an ankle bracelet upon release.

See Wayne Rouston, Woman stole over $100K by altering stepfather's will, investigators say, Sun Sentinel, May 28, 2015.

May 29, 2015 in Current Affairs, Current Events, Wills | Permalink | Comments (0)

Article On Law and the Problem of Restricted-Spending Philanthropy

Brian GalleBrian T. Galle (Assistant Professor, Boston College Law School) recently published an article  entitled, Pay It Forward? Law and the Problem of Restricted-Spending Philanthropy, Washington University Law Review, (2016). Provided below is an excerpt from the article:

American foundations and other philanthropic giving entities hold about $1 trillion in investment assets, and that figure continues to grow every year. Even as urgent contemporary needs go unmet, philanthropic organizations spend only a tiny fraction of their wealth each year, mostly due to restrictive terms in contracts between donors and firms limiting the rate at which donations can be distributed. Law has played a critical role in underwriting and encouraging this build-up of philanthropic wealth. For instance, contributors can typically take a full tax deduction for the value of their contribution today, no matter when the foundation spends their money, and pay no tax on the investment earnings the organization reaps in the meantime.

What, if anything, justifies public support for “restricted spending” charity? This Article offers the first comprehensive assessment of that question, and supplies original empirical evidence on several key aspects of it. I argue that restricted spending sacrifices crucial information, introduces unnecessary agency costs, and on average transfers funds to times when they are less useful. While there is a place for large and long-lived philanthropic organizations in American society, that role does not require public support for restricted spending. As long as foundations can demonstrate their value to new donors, they will continue to thrive. I therefore set out a series of policy recommendations aimed at better reconciling nonprofit law and the principles that justify it.

I support my claims with new evidence drawn from a data set of over 200,000 firm-year observations of private foundations. For example, I find that foundations earn about twice as much money per year as in earlier studies funded by foundation-industry lobbyists, and that they are growing three times faster than those earlier studies suggest. This finding implies that law could require a much higher annual “payout” from foundations. I also find that new laws introduced in about a dozen states since 2006 have significantly slowed foundation spending in the enacting states. And I offer simulations of several policy proposals for making foundations more effective at fighting recessions.

May 29, 2015 in Estate Planning - Generally, Estate Tax, Wills | Permalink | Comments (0)

Thursday, May 28, 2015

Plan Ahead To Avoid Family Heirloom Disputes

HeirloomDisputes over family heirlooms that have both monetary and sentimental value can create tension and divide families.  It is a good idea for a person creating a will to plan ahead about who they will be inheriting the heirlooms.  Clients should be advised to discuss these issues with friends and family ahead of time.  Talk with loved ones about what heirlooms they would like to inherit so that future confusion and conflicts can be avoided. 

See Ray and Dana Brandon, Heirloom Jewelry and Your Heirs, The daily News, May 28, 2015. 

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

May 28, 2015 in Current Affairs, Estate Planning - Generally, Wills | Permalink | Comments (0)

Without An Estate Plan Property Might Go To State

RyanI have previously discussed how an unknown descendent of Lizzie Ryan could be eligible to inherit a $788,000 estate.  If an heir is not found in thirty years then the estate will go to the British Crown.  In the United States, if an heir is not found then the property often escheats to the State government after a certain amount of time.  If a person does not want their property to go to the state it is important to have an estate plan. 

See Idaho Estate Planning, Leaving Your Estate To The State?, Wealth Management, May 27, 2015.

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

May 28, 2015 in Current Affairs, Estate Planning - Generally, Intestate Succession, Wills | Permalink | Comments (0)

Claim B.B. King Murdered Ploy By Children To Take More Under Will Says Lawyer

NN KingThe lawyer for the late B.B. King recently stated that the claims of Mr. King being murdered by poison are likely ploys to take more from the singers estate. While there was a power of attorney transfer shortly before the death of Mr. King, it was not with the intent to deprive the children of the inheritance that was originally provided for them. Most of the money in the estate has been set aside in a trust that will provide for the education expenses of the beneficiaries but nothing more.

See Nancy Dillon, EXCLUSIVE: B.B. King's kids may be making 'ridiculous' claims he was poisoned because he only left them $5,000 each in his will, lawyer says, The Daily News, May 27, 2015.

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

May 28, 2015 in Current Affairs, Current Events, Wills | Permalink | Comments (0) | TrackBack (0)

Wednesday, May 27, 2015

In Modern Estate Planning Basis Plays Important Role

ScaleThe American Taxpayer Relief Act of 2012 raised the federal estate tax exemption to $5 million for each individual.  This amount is adjusted to inflation which means an individual can transfer up to $5,430,000 before being effected by the estate tax.  The change to estate tax law has shifted the focus of many estate planners from “estate tax” planning to “basis” planning.

“Basis” is an income tax concept which the IRS uses to calculate the tax a person owes after selling an asset.  Individuals and couples should consider the fair market value of their assets before deciding on whether to give the asset away as a gift or transfer it at death.   Estate Planners should be prudent about considering basis in order to reduce the income tax liability that a client will face.

See Virginia Carter & Zachary Lamb, Ward and Smith, P.A. Modern estate planning – It’s all about that basis, May 27, 2015.

May 27, 2015 in Current Affairs, Estate Planning - Generally, Estate Tax, Income Tax, Trusts, Wills | Permalink | Comments (0) | TrackBack (0)

B.B. King’s Children Face Long Complex Legal Battle

Old bb kingI have previously discussed the dispute over the estate of B.B. King.  The late blues is currently survived by 11 living biological and adopted children.  King’s children are currently in a high profile dispute with LaVerne Toney, the Musicians former business agent who currently has power of attorney over King’s estate.  The children of B.B. King have a long legal battle ahead of them, this dispute is far from over.

See Justin Wm. Moyer, B.B. King: 15 children and potentially a big legal mess, The Washington Post, May 22, 2015.

May 27, 2015 in Current Affairs, Estate Planning - Generally, Trusts, Wills | Permalink | Comments (0) | TrackBack (0)

Article On Minimizing Probate-Error Risk

Mark GloverMark Glover (Assistant Professor of Law, University of Wyoming) recently published an article entitled, Minimizing Probate-Error Risk, 49 University of Michigan Journal of Law Reform (Forthcoming 2016). Provided below is an excerpt from the article:
By prescribing the method by which courts evaluate the authenticity of wills, the law of will-execution allocates probate-error risk between false-positive outcomes and false-negative outcomes. When the court validates an inauthentic will, the result is a false-positive outcome. When the court invalidates an authentic will, the result is a false-negative outcome. Because false-positive outcomes result in the admission to probate of inauthentic wills and false-negative outcomes result in the denial of probate of genuine wills, both can be characterized as probate errors.

This framework has been used to identify the problem with the conventional law of will-execution, which is that it heavily allocates risk in favor of false-negative outcomes and consequently produces probate errors that could easily be avoided. It has also clarified the objective of will-execution reform, which is to reallocate risk more evenly between false-positive outcomes and false-negative outcomes so that the total number of probate errors is minimized.

This Article applies this framework more broadly to analyze potential methods of will-execution reform. Specifically, this Article identifies the various components of the law of will-execution that can be altered to reallocate probate-error risk and evaluates how different methods of reform can be manipulated to reallocate risk to varying degrees. With a better understanding of what is possible, state policymakers may be more willing to break away from the conventional law and implement change.

May 27, 2015 in Articles, Estate Administration, Estate Planning - Generally, Wills | Permalink | Comments (0) | TrackBack (0)

Tuesday, May 26, 2015

Three Documents Every 18 Year Old Should Have

Alicecooper18It is always a good idea to plan ahead for not only your client, but also your client’s children.  When a client’s child turns 18 they should have a will, healthcare power of attorney, and property power of attorney.  It makes good business sense for an estate planner to build a working relationship with not only his or her client but also the client’s children since they will be inheriting many of the assets that you helped make plans for.  It is true that 18 year old individuals do not often have a lot of property or assets, but it is still important to plan for unexpected medical emergencies by having a will and naming a person who would have power of attorney.

See David H. Lenok, What Documents Do Your Clients 18-Year-Old-Children Need?, Trusts & Estates, May 26, 2015.

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

May 26, 2015 in Current Affairs, Disability Planning - Health Care, Disability Planning - Property Management, Estate Planning - Generally, Wills | Permalink | Comments (0) | TrackBack (0)