Wills, Trusts & Estates Prof Blog

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

Friday, September 17, 2021

Article: A Tax Credit for Wills

Margaret Ryznar recently published an article entitled, A Tax Credit for WillsWills, Trusts, & Estates Law ejournal (2021). Provided below is the abstract to the Article. Wills

In this article, Ryznar suggests using tax law to encourage people to execute wills, arguing that the coronavirus pandemic revealed the importance of estate planning.

September 17, 2021 in Articles, Estate Administration, Estate Planning - Generally, Wills | Permalink | Comments (0)

Thursday, September 16, 2021

Selena's former husband Chris Perez ends years-long legal battle with Quintanillas over documentary

SelenaSelena's former husband Chris Perez posted a tweet on Tuesday claiming that his legal battle—which has lasted a half-decade—with the Quintanilla family has come to a mutual end. The legal battle was over a proposed Selena documentary. 

According to the former husband of the late Tejano idol, he and the Quintanilla family have "amicably resolved" their ongoing legal dispute over the proposed documentary on Selena's life and music. 

Chris Perez's tweet read:

Good news! I have amicably resolved my legal dispute with the Quintanilla family. Now that these issues are behind us, going forward, my hope, and the hope of the Quintanilla family, is for us to work together to continue to honor and celebrate the legacy of Selena. 

Selena's father, Abraham Quintanilla Jr., shared a similar message of reconciliation on Facebook shortly after Perez's post. 

See Ariana Garcia, Selena's former husband Chris Perez ends years-long legal battle with Quintanillas over documentary, Chron, September 15, 2021. 

Special thanks to Laura Galvan (Attorney, San Antonio, Texas) for bringing this article to my attention.  

September 16, 2021 in Estate Administration, Estate Planning - Generally, Music | Permalink | Comments (0)

Wednesday, September 15, 2021

Family Education Trusts: Leave a Lasting Legacy For Your Heirs

Estate planningIt is an important—and honorable—objective to provide for the educational needs for your children, grandchildren, and even future generations. One option that can be used to achieve that objective is a 529 plan. A 529 plan can be "a highly effective tool for funding tuition and other educational expenses on a tax-advantaged basis." 

However, after death, there's no guarantee that subsequent plan owners will continue to use it to achieve the objectives of the original owners. One alternative would be to create a family education trust that invests in a 529 plan. 

529 plans allow parents to make substantial, nondeductible constitutions up to and over $400,000 depending on the plan. 529 plans can be used to pay for tuition, books, fees, supplies, equipment, and room and board at most accredited colleges and universities and certain vocational schools. 529 plans may also be used to pay up to $10,000 per year per student for elementary and secondary school tuition.

Owner's can also have control over "the timing of distributions, can change beneficiaries from one family member to another and can roll the funds over into another state's plan tax-free." 

Given the disadvantages of 529 plans, like the inability to invest assets other than cash, it could be beneficial to establish a family education trust to hold one or more 529 plans. 

See David T. Riedel, Family Education Trusts: Leave a Lasting Legacy For Your Heirs, Adler, Pollock, & Sheehan P.C., September 7, 2021. 

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

September 15, 2021 in Estate Administration, Estate Planning - Generally, Trusts | Permalink | Comments (0)

Tuesday, September 14, 2021

America Is Spending a Fortune to Help Rich People Retire in Luxury

Estate planningAffluent boomers have been able to take advantage of federal programs originally conceived for ordinary families. 

Roth IRAs are a useful way to save money for retirement and are used by many Americans. Although fashioned for ordinarily families, ultra rich people like tech billionaire Peter Thiel have been able to maximize the usage of Roth IRAs. 

Thiel has been able to use the Roth IRA o accumulate more than $5 billion. Nonprofit journalism shop ProPublica ran an exposé in June "revealing how a small number of extremely wealthy folks had ended up with Roths—federally subsidized retirement accounts meant for middle-class savers–worth tens to hundreds of millions of dollars and up." Thiel was able to do so by "stuffing" his Roth IRA with "wildly undervalued "founders shares" of pre-IPO startups—potentially an illegal tactic—and then watching as their values rose exponentially, and completely tax-free." 

According to the nonpartisan Joint Committee on Taxation, "as of 2019, more than 28,000 Americans held combined (Roth and tradition) IRA balances of $5 million or more and 497 taxpayers had balances of at least $25 million. The latter group had socked away a combined $77 billion in their IRAs—on average, more than $150 million each." 

According to Steve Rosenthal, a tax attorney and senior fellow at Urban-Brookings Tax Policy Center, "the government spends a fortune subsidizing a whole range of retirement plans whose benefits flow overwhelmingly to America's most affluent. . .It's unbelievable the amounts of dollars at stake, and how titled they are to the high end." 

See Michael Mechanic, America Is Spending a Fortune to Help Rich People Retire in Luxury, Mother Jones, September 1, 2021. 

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

September 14, 2021 in Estate Administration, Estate Planning - Generally | Permalink | Comments (0)

Monday, September 13, 2021

Skateboards containing American pro skater Tony Hawk's blood sell out overnight

TonyYou may be familiar with the phrase "blood, sweat, and tears," when referring to an person's—particularly athlete's—hard work in a particular field. Tony Hawk took this phrase to another creative level when he "donated his blood as part of a collaboration with water company Liquid Death to produce 100 skateboards."

The 100 skateboards sold out quickly. 

According to a social media post from Liquid Death, "Yes, there is actually @tonyhawk's real blood in these skateboards. and yes, we sterilized it first. Own your very own piece of the Birdman. . . Although it could arguably make the world a better place, never ever use these boards to make clones of Tony Hawk." 

See Jack Guy, Skateboards containing American pro skater Tony Hawk's blood sell out overnight, CNN, August 26, 2021. 


September 13, 2021 in Estate Planning - Generally, Sports | Permalink | Comments (0)

Sunday, September 12, 2021

Democrats may rein in big estates without reforming the estate tax

Wealth taxDemocrats may limit some strategies used by wealthy Americans to reduce or avoid estate taxes. The list of potential tax reforms connected to the Democrats' $3.5 trillion budget plan include grantor-retained annuity trusts, intentionally defective grantor trusts and non-economic valuation discounts. 

The targeted strategies are often used by multimillionaires and billionaires to "gift appreciated assets to heirs tax-free while reducing the size of their taxable estate. . ." 

In addition to disallowing certain complex trust-planning techniques, Congressional Democrats may also ask the Treasury Department to update regulations to "prevent the abuse of non-economic valuation discounts."

According to Robert Lord, counsel for progressive group Americans for Tax Fairness, "[b]asically you've got this basket of loopholes that collectively can be used to defeat the estate tax at really any level, even billionaires." 

"Interestingly, Democrats don't seem to be weighing reforms to the estate tax itself, such as a higher tax rate or a reduced asset threshold that would subject more estates to federal levies." 

The Democrats' proposed estate-tax reforms "are part of Democrats' broader theme of raising taxes on the wealthy to help fund climate, paid leave, childcare and education measures. . ." 

See Greg Iacurci, Democrats may rein in big estates without reforming the estate tax, CNBC Personal Finance, September 10, 2021. 

Special thanks to Deborah Matthews (Virginia Estate Planning Attorney) for bringing this article to my attention.

September 12, 2021 in Estate Administration, Estate Planning - Generally, Estate Tax, New Legislation | Permalink | Comments (0)

Saturday, September 11, 2021

Don McLean says his daughter's $3M trust fund went 'down the tubes' following abuse accusations

Don McLean, the famous 'American Pie' singer revealed that he "cut off his daughter, Jackie McLean, financially after she gave a tell-all interview accusing him of mental and emotional abuse." 

Don stated "I stopped supporting my daughter last year. . .I have a son [Wyatt], you know, who grew up the same way who thinks I'm a great father and who has none of these complaints. But I said to my daughter, if you speak out about me and trash me, I'm going to disinherit you."

Don's daughter alleged that her dad would "turn into a crazy person over the slightest things when she was a child." She also claimed that "If somebody moved an item in the house and he didn't know where it was, then he would go on a rampage for hours." 

Don denied his daughter's accusations and claimed that he has always loved and supported his daughter—until he cut her off. 

See Nicki Gostin, Don McLean says his daughter's $3M trust fund went 'down the tubes' following abuse accusations, Fox News, September 10, 2021. 


September 11, 2021 in Estate Administration, Estate Planning - Generally | Permalink | Comments (0)

Friday, September 10, 2021

Britney Spears’s father files to end her 13-year conservatorship

Free BritneyBritney Spears's father, Jamie Spears, filed a petition in Los Angeles Superior Court to end the conservatorship controlling his daughter's life and finances. 

The petition was filed on Tuesday, nearly a month after Jamie Spears agreed to vacate his role as the pop star's conservator. Jamie Spears has served as conservator of the pop star's estate for 13 years. 

Britney Spears's conservatorship was established in 2008 "as she publicly struggled with her mental health in the face of intense, unrelenting scrutiny from the news media and paparazzi."

The petition will not go into effect unless Judge Brenda Penny approves. The next hearing was set for September 29, in which Penny was set to hear a petition from Britney Spears's counsel, Mathew Rosengart, in which he would have advocated to remove Jamie Spears as conservator. 

Rosengart stated that the petition "represents a massive legal victory for Britney Spears, as well as vindication. 

See Sonia Rao, Britney Spears’s father files to end her 13-year conservatorship, The Washington Post, September 8, 2021. 

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

September 10, 2021 in Estate Administration, Estate Planning - Generally, Guardianship, Music | Permalink | Comments (0)

Wednesday, September 8, 2021

Florida Probate & Intestacy Guides Available

MAP-OF-FLORIDA-743x5001The Florida Probate Law Group  has recently made available some useful materials regarding Florida probate law:

Chart to determine intestate heirs, and

A guide to Florida probate.

September 8, 2021 in Estate Administration, Intestate Succession | Permalink | Comments (0)

Brother Had Standing Under Texas Slayer Statute To Seek Declaration Regarding Rights To Insurance Proceeds

Estate planningIn Lawrence v. Bailey, the Texas First District Court of Appeals addressed whether "a relative had standing under the Texas Insurance Code's Slayer Statute to obtain a declamatory judgment as to the disposition of life insurance proceeds." 

Steven Lawrence's wife LaQuita was named the primary beneficiary in his life insurance policy, which was issued by Hartford in January 2008. Their son Ross was named the contingent beneficiary. 

Steven and LaQuita were killed in their home in October 2013 and ross was indicted for capital murder for killing them. 

Hartford filed an interpleader petition in order to seek direction as to what to do with the life insurance funds. In the mean time, Hartford deposited the insurance proceeds with the registry of the court. 

Robert (Steven's brother) filed a tradition motion for summary judgment, in which he argued that based on the Texas slayer statute, he was entitled to the life insurance proceeds as a matter of law. 

The trial court ruled that it was granting the special exceptions and denying Robert's motion for summary judgment and set a trial for March of 2020. One month later, the administrator of Steven's Estate filed a "Motion to Close and Distribute Funds in Registry of the Court to the Estate of Steven Ross Lawrence, Deceased."

The trial court granted the administrator's motion and Robert filed a motion for new trial alleging that the trial court "spontaneously granted" the motion to distribute the interpleader funds to Steven's Estate, "without a hearing or notice" to him. 

Robert also asserted that "[t]his was a fundamental violation of Robert's right to due process." Robert asked the trial court to vacate the order awarding the insurance proceeds to Steven's Estate and grant him a new trial. The trial court denied the motion and Robert appealed. 

Under the Texas Insurance Code: 

A beneficiary of a life insurance policy or contract forfeits the beneficiary's interest in the policy or contract if the beneficiary is a principal or an accomplice in willfully bringing about the death of the insured.

The Texas appeals court determined that Robert had standing to obtain declaratory relief under the Texas slayer statute. The court determined that "the record also demonstrated that a real controversy exists between the parties regarding the insurance proceeds, since Hartford interpled funds indicating it anticipated rival claims to the funds." 

Despite the fact that the murder case against Ross had not been solved yet, the court found that the Texas Slayer Statute does not require that any criminal case relating to "whether the beneficiary willfully brought about the insured's death be resolved before the willfulness determination is made." 

See Brother Had Standing Under Texas Slayer Statute To Seek Declaration Regarding Rights To Insurance Proceeds, Probate Stars, August 30 2021. 

September 8, 2021 in Estate Administration, Estate Planning - Generally, Non-Probate Assets | Permalink | Comments (0)