Wills, Trusts & Estates Prof Blog

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

Saturday, February 24, 2024

Article: DNA Test Kit Horror Story

Estate planningVictoria Hill, a 39-year-old licensed clinical social worker from suburban Connecticut, always felt different from her father in appearance and temperament. This curiosity led her to purchase a DNA testing kit from 23andMe a few years ago to investigate a health issue. However, what started as a routine quest for self-discovery turned into a shocking revelation. The test revealed that she had more siblings than she had ever imagined - a staggering count of 22. Worse still, she discovered that her biological father was not the man she grew up with but rather a fertility doctor named Burton Caldwell, who allegedly used his sperm to inseminate her mother without her consent. This revelation shattered Hill's understanding of her identity and relationships, mainly when she learned that one of her newfound siblings was her high school boyfriend. This situation could have led to accidental incest.

Hill's story is emblematic of a more significant issue of fertility fraud plaguing the United States, where fertility doctors have misled patients and their families by secretly using their sperm instead of donor sperm. Despite the significant emotional and ethical implications of such actions, most states lack laws against fertility fraud, leaving victims with little recourse. Hill's case underscores the urgent need for regulation in the fertility industry and the growing movement of donor-conceived individuals advocating for transparency and accountability. While some progress has been made with the passage of new state laws in recent years, the legal landscape remains inconsistent, highlighting the challenges faced by those seeking justice and closure in cases of fertility fraud.

For more information see Rob Kuznia, Allison Gordon, Nelli Black, and Kyung Lah “DNA Test Kit Horror Story”, CNN, February 14, 2024.

February 24, 2024 in Estate Planning - Generally | Permalink | Comments (0)

Friday, February 23, 2024

Article: Rectification of Testamentary Writings in Scotland, England and Wales, and Australia

Daniel James Carr (University of Edinburgh Law School) recently published, Rectification of Testamentary Writings in Scotland, England and Wales, and Australia, Journal of Equity, forthcoming. Provided below is an Abstract:

This article considers statutory and non-statutory means of rectifying a testamentary writing in Australia, England and Wales, and Scotland. Assessing the statutory provisions in the comparator jurisdictions shows that there are tangible differences between the statutory regimes. Such differences embody different policy decisions concerning the importance of formally recorded testamentary intention in an instrument and the circumstances in which it will be possible to resort to rectification based upon other means of identifying the testator’s intentions or instructions. Differences between the non-statutory routes to rectification in the Scottish and the Anglo-Australian traditions are outlined, and the article identifies enduring questions about the precise contours of the non-statutory rectification jurisdiction in each tradition. The article concludes by noting the benefits of looking at the evolution of the different rectification approaches together and how they fit with changing approaches to the importance of insistence upon strict testamentary formalities.

February 23, 2024 in Articles, Estate Planning - Generally | Permalink | Comments (0)

Thursday, February 22, 2024

Article: Taxing Old Money: Considerations in Crafting a Rignano Tax

Miranda Perry Fleischer (University of San Diego School of Law) recently published, Taxing Old Money: Considerations in Crafting a Riganano Tax, Law, Ethics and Philosophy, 2020, January 2024. Provided below is an Abstract:

This article explores whether it is possible to tax “old money” differently than “new money.” In The Inheritance of Wealth, Daniel Halliday proposes that we tax wealth more heavily the second time it is transferred than the first, and even more heavily the third time. He envisions something like the following: Grandfather builds a business from the ground up and bequeaths $10,000,000 to Mother. No tax is imposed, but if Mother does not create any wealth of her own and simply retransfers $10,000,000 to Daughter, all of Mother’s estate is taxed. In contrast, if Mother creates new wealth, different portions of her estate are treated differently. The inherited $10,000,000 that Mother re-transfers is taxed, while any newly-earned wealth is not. Although Halliday offers a few broad structural suggestions, he does not detail how such a tax—referred to as a Rignano tax—would work. This article explores what implementing a Rignano tax requires. Crafting one is complex but feasible and requires six key design decisions. Drawing on experience with existing transfer taxes and Halliday’s ethical premises, this article offers specific recommendations for each.

February 22, 2024 in Articles, Estate Planning - Generally | Permalink | Comments (0)

Gonzaga seeks Visiting Assistant Professor for Wills & Trusts

The following announcement is from The Faculty Lounge and was brought to my attention by Adam Hirsch:

GONZAGA UNIVERSITY SCHOOL OF LAW, in Spokane, WA seeks applicants for up to three full-time Visiting Assistant Professors. This position is a 9-month, terminal visiting position beginning in August 2024 with the potential to renew for one or more additional years (contingent upon need and funding). It is ideal for both current law professors who wish to visit away from their home institutions and for aspiring law professors who plan to apply to tenure-track law school positions in the future. Our curricular needs include Contracts, Criminal Law, Evidence, Professional Responsibility, Wills and Trusts, Lawyering Skills, Legal Research and Writing, and Academic Support courses.

For more information and to apply, click here.

February 22, 2024 in Faculty Positions -- Visiting | Permalink | Comments (0)

Wednesday, February 21, 2024

Article: On the Macroeconomics and Distributional Effects of Federal Estate Tax Reforms in the United States

Pieter Van Rymenant (Ghent University), Freddy Heylen (Ghent University), and Dirk Van de Gaer (Ghent University) recently published, On the Macroeconomic and Distributional Effects of Federal Estate Tax Reforms in the United States, December 2023. Provided below is an Abstract:

This paper argues that the strong reductions in U.S. federal estate taxes since 1980 have not generated positive effects on labor supply, private capital formation, and economic activity. Rather, these estate tax cuts have contributed considerably to rising after-tax wealth inequality. To study the macroeconomic and distributional effects of estate tax changes over time, we construct and simulate a dynamic general equilibrium OLG model with firms, a fiscal government, and heterogeneous households. Our model also captures the joint taxation of inter-vivos transfers and bequests in the U.S. since 1976. The key underlying result is that the aggregate stocks of pre-tax bequests and wealth are very insensitive to estate tax changes, even when households value after-tax bequests (warm glow). As a result, the yearly foregone estate tax revenues are large, especially in the long run.

February 21, 2024 in Articles, Estate Planning - Generally | Permalink | Comments (0)

Tuesday, February 20, 2024

Alabama Supreme Court rules frozen embryos are children, imperiling IVF

Estate planningThe Alabama Supreme Court ruled last week that frozen embryos are legally considered people, holding those accountable for the destruction of embryos. This landmark decision is considered a victory by anti-abortion activists, which may have significant consequences for reproductive rights, particularly in the realm of in vitro fertilization (IVF). 

With at least 11 states defining personhood as starting at fertilization and ongoing debates over abortion and reproductive restrictions, the ruling amplifies concerns ahead of the 2024 elections. The case in Alabama involved a wrongful death lawsuit where a patient accidentally destroyed another couple's embryos. The court's ruling, which overruled a lower court, emphasized that unborn children, including frozen embryos, are protected under existing laws. 

This decision could set a precedent with far-reaching implications, potentially affecting IVF procedures, contraceptives, and healthcare providers' practices. Critics fear it could increase the cost of IVF, prompt clinic closures, and deter patients from pursuing fertility treatments due to legal risks.

Critics have also noted the Alabama chief justice's use of theology in the ruling, expressing concern that a judge's religious beliefs could influence personal decisions. The ruling did not clarify if embryo destruction under any circumstance would be permitted. While the plaintiffs had agreed to terms allowing for embryo destruction or donation after a specified period, the court did not address this due to the trial court's oversight. The decision underscores how overturning Roe v. Wade has empowered judges and legislators to restrict more than just abortion, leaving the extent of state and court authority uncertain.

For more information see Dan Rosenzweig-Ziff  “Alabama Supreme Court rules embyros are children, imperiling IVF”, The Washington Post, February 19, 2024.

Special thanks to Lewis Saret (Attorney, Washington, D.C.) for bringing this article to my attention. 

February 20, 2024 in Current Affairs, Estate Planning - Generally | Permalink | Comments (0)

Monday, February 19, 2024

Here's What's Raising Red Flags With IRS Auditors In 2024

Estate planningThe IRS intensifies scrutiny on high-net-worth taxpayers, prompting advisors to emphasize the importance of watching for audit triggers during the current filing season. Increased audit notices requesting detailed records and explanations are observed by CPA firms, indicating higher audit probabilities than in previous years. 

The Treasury Department's directive to the IRS is to prioritize enforcement efforts on large corporations, high-income individuals, high-net-worth individuals, and complex pass-through entities, aiming for high-dollar non-compliance cases. The IRS mainly targets discrepancies in balance sheets of partnerships with over $10 million in assets; foreign asset reports exceeding $10,000, and payments from construction contractors to apparent shell company subcontractors. Additionally, large deductions or tax credits disproportionate to income and unreported income are under scrutiny. 

Digital assets, especially cryptocurrency transactions, are also raising red flags. Wealthy individuals with closely held businesses are at heightened risk of full audits, as the IRS increasingly relies on digital verification methods but faces challenges in matching income and deductions from sole proprietorships reported on Schedule C.

For more information see Jeff Stimpson “Here’s What’s Raising Red Flags with IRS Auditors in 2024”, Financial Advisor, January 29, 2024.

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

February 19, 2024 in Estate Planning - Generally | Permalink | Comments (0)

Sunday, February 18, 2024

Article: A Critical Analysis of the Law of Death, Marriage and Wealth

Alyssa A. DiRusso (ACTEC Academic Fellow, Professor of Law at Cumberland School of Law at Samford University) recently published, A Critical Analysis of the Law of Death, Marriage, and Wealth, ACTEC Law Journal, VOLUME 49, Number 1, Fall 2023 (pub 1/24). Provided below is an Introduction:

Whether “until death do us part” is a viable estate planning technique depends upon the wealth of the couple. Federal law regulating asset retention and transfer when death is nigh creates two strikingly different systems. Whereas the federal estate and gift taxes provide powerful incentives and support for marriage, the Medicaid system extends paltry protections and incentivizes divorces or remaining unmarried.

Although family law scholars have robustly criticized the law for its preferences for marriage (and sometimes nonmarriage), a critical trusts and estates perspective can enhance this discussion. The following paper will demonstrate how the zone of overlap between trusts and estates and family law—as marriages near death—is particularly fraught and dysfunctional. Taking Medicaid and the estate tax as examples, this paper will show the way the law entrenches marriage among the already privileged yet threatens it for the poor. Comparing these particular systems creates a compelling foil to contrast marriage at the top and the bottom of the wealth spectrum.

February 18, 2024 in Articles, Estate Planning - Generally | Permalink | Comments (0)

Saturday, February 17, 2024

Article: Confusing Cy Près

CJ Ryan (Indiana University Maurer School of Law) recently published, Confusing Cy Près, Georgia Law Review, Vol. 58. 2023. Provided below is an Abstract:

American courts have increasingly considered the possibility of prolonging the life of charitable trusts through cy près and the closely related doctrine of equitable deviation. This requires courts to interpret the material purposes of trusts and even the administrative terms on which settlors of charitable trusts condition gifts in trust made for public benefit. Yet, the implicit reasons why courts might invoke cy près to change a charitable trust’s material purpose have not been explored in significant depth heretofore—and neither has a common but vexing trend of courts conflating cy près with deviation, which negatively impacts charitable trust-making.

I analyze the extent to which judges have struggled with applying these remedies via an empirical analysis of a universe of cases receiving a published opinion from an American court from the nation’s founding through 2019. This study provides an original analysis of the cy près doctrine, including its use and misuse, along an extended timeline in American history. The study’s novel contributions are twofold. First, it teases out the distinction between cy près and like equitable doctrines. In doing so, it elucidates how courts confuse cy près with other equitable remedies. Second, it discusses the sources of the confusion around the cy près and deviation doctrines by empirically testing the factors that bear on a court’s decision to employ them accurately or inaccurately. These findings have implications not only for resolving the boundaries of the cy près doctrine, while encouraging charitable trust-making, but also for defining the critical role that judges play in shaping both the cy près doctrine and trust settlors’ expectations in the past, in the present, and for the future.

February 17, 2024 in Articles, Estate Planning - Generally | Permalink | Comments (0)

Friday, February 16, 2024

Article: How Gender and Other Identity Factors Influence Attitudes Toward Will Making: Lessons from Australia

Bridget J. Crawford, Tina Cockburn, Kelly Purser, Ho Fai Chan, Stephen Whyte & Uwe Dulleck recently published, How Gender And Other Identity Factors Influence Attitudes Toward Will Making: Lessons From Australia, ACTEC Law Journal, VOLUME 49, Number 1, Fall 2023 (pub 1/24). Provided below is an Abstract:

This essay aims to stimulate interest in further empirical study of attitudes toward will making by reporting the results of a 2022 survey conducted in Australia of the general population (n=1202) and legal professionals (n=112). We asked participants for their views about the ideal age at which to begin the will-making process and the relative contributions of the client and attorney to any resulting will. There was a discernible gender-based difference in views on both questions. Women preferred to initiate those conversations approximately six years earlier than men did and especially at earlier life stages, preferred less professional input into the will-making process than men did. Income and education levels appear to have no impact on individuals’ responses to these questions. The sample population was sufficiently homogeneous that it is not possible to draw conclusions about how religious background or political views  may impact preferences about when the first will-making conversation should occur or the desired relative contribution of the legal professional to the ultimate will.

February 16, 2024 in Articles, Estate Planning - Generally | Permalink | Comments (0)