Wills, Trusts & Estates Prof Blog

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Happy New Year and Best Wishes for 2013!!!

Woman Gets Probation For Stealing $60,000

A woman by the name of Angel Edmonds was convicted of stealing the life savings of an elderly woman in her care. According to Hernando Today, "Judge Daniel Merritt Sr. sentenced the 37-year-old woman to two years of house arrest, requiring the mother of three to repay Florence Butler at least $900 a month until the $60,000 she stole in 2011 was repaid."

According to the family of Butler, Edmonds had take care of Butler since 2008 and they cannot believe that she could have stolen from Butler. Edmonds used the money to purchase several luxury items, including "a SUV, a dog costing more than $1,000, concert tickets, satellite radio, toys and music purchases." Because of the extravagant and unnecessary purchases, the prosecutor stated that Edmonds should receive no less than 5 years in prison. Judge Merritt disagreed with this assessment but not for the reasons given. In fact, Judge Merritt claimed that the only reason that Edmonds was not going to jail was because she has small children and still needs to repay Butler. Thankfully for Butler, Edmonds recently found employment. The family of the victim also received the SUV that Edmonds bought with Butler's money.

See Wendy Joan Biddlecombe, Woman Who Stole $60,000 From Client Gets Probation, Hernando Today, Dec. 30, 2012.

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

Fiscal Cliff Estate Tax Fight

As of yesterday on December 30, 2012, the several key members of the Senate, including the Majority Leader Harry Reid, reconvened talks over the fiscal cliff. It is believed that members of the Senate are working on a small deal that involves a portion of the Bush-era tax cuts. Aides from the Hill claim that the "Democrats are likely to make concessions on the estate tax to Republicans — who loath high rates on what they've dubbed the 'death tax' — in exchange for keeping the Bush tax cuts at the president's preferred threshold of $250,000."

As I have previously discussed, several Democrats are concerned with how an increase in the estate tax might affect their constituents who are farmers and ranchers. I have discussed how a reduction in the estate tax exemption could harm farmers particularly hard because the nature of the wealth that they transfer at death. The split that this has created among the Democrats in the Senate, including Senator Max Baucus, could give Republicans the edge as they move into the final hours of the fiscal cliff debate.

See Suzy Khimm, The 'Fiscal Cliff's' Estate Tax Fight, Explained, The Washington Post, Dec. 30, 2012.

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

Top SSRN Downloads

Here are the top downloads from October 31, 2012 to December 30, 2012 from the SSRN Journal of Wills, Trusts, & Estates Law for all papers announced in the last 60 days.

Rank	Downloads	Paper Title
1	335	Planning in the Digital Age Gerry W. Beyer, Texas Tech University School of Law, Date posted to database: October 24, 2012 Last Revised: November 12, 2012
2	129	Valuation Discounting and the Lottery Cases Wendy C. Gerzog, University of Baltimore - School of Law, Date posted to database: November 20, 2012 Last Revised: November 20, 2012
3	99	Justifying Fiduciary Remedies Paul B. Miller, Queen's University (Canada) - Faculty of Law, Date posted to database: October 28, 2012 Last Revised: October 28, 2012
4	67	Resident Rights and Responsibilities in Virginia's Continuing Care Retirement Communities: Building Trust and Stronger Communities Katherine C. Pearson, Pennsylvania State University - Dickinson School of Law, Date posted to database: December 2, 2012 Last Revised: December 2, 2012
5	51	Louisiana Prenuptial Agreements: Issues for Contemporary Spouses Elizabeth Ruth Carter, Louisiana State University, Baton Rouge - Paul M. Hebert Law Center, Date posted to database: November 2, 2012 Last Revised: December 11, 2012
6	46	The Therapeutic Function of Testamentary Formality Mark Glover, Louisiana State University - Paul M. Hebert Law Center, Date posted to database: November 3, 2012 Last Revised: November 3, 2012
7	39	Fiduciary Duties and Exculpatory Clauses: Clash of the Titans or Cozy Bedfellows? Louise L. Hill, Widener University School of Law, Date posted to database: November 29, 2012 Last Revised: November 29, 2012
8	38	Would Enactment of the Uniform Premarital and Marital Agreement Act in All Fifty States Change U.S. Law Regarding Premarital Agreements? J. Thomas Oldham, University of Houston - Law Center, Date posted to database: December 9, 2012 Last Revised: December 9, 2012
9	36	Sex Post Facto: Advising Clients Regarding Posthumous Conception Benjamin C. Carpenter, University of St. Thomas School of Law (Minnesota), Date posted to database: December 4, 2012 Last Revised: December 8, 2012
10	35	LGBT Issues and Adult Guardianship: A Comparative Perspective Nancy J. Knauer, Temple University - James E. Beasley School of Law, Date posted to database: November 9, 2012 Last Revised: November 9, 2012

Top SSRN Downloads

Here are the top downloads from October 31, 2012 to December 30, 2012 from the SSRN Journal of Wills, Trusts, & Estates Law for all papers announced in the last 60 days.

Rank	Downloads	Paper Title
1	335	Planning in the Digital Age Gerry W. Beyer, Texas Tech University School of Law, Date posted to database: October 24, 2012 Last Revised: November 12, 2012
2	129	Valuation Discounting and the Lottery Cases Wendy C. Gerzog, University of Baltimore - School of Law, Date posted to database: November 20, 2012 Last Revised: November 20, 2012
3	99	Justifying Fiduciary Remedies Paul B. Miller, Queen's University (Canada) - Faculty of Law, Date posted to database: October 28, 2012 Last Revised: October 28, 2012
4	67	Resident Rights and Responsibilities in Virginia's Continuing Care Retirement Communities: Building Trust and Stronger Communities Katherine C. Pearson, Pennsylvania State University - Dickinson School of Law, Date posted to database: December 2, 2012 Last Revised: December 2, 2012
5	51	Louisiana Prenuptial Agreements: Issues for Contemporary Spouses Elizabeth Ruth Carter, Louisiana State University, Baton Rouge - Paul M. Hebert Law Center, Date posted to database: November 2, 2012 Last Revised: December 11, 2012
6	46	The Therapeutic Function of Testamentary Formality Mark Glover, Louisiana State University - Paul M. Hebert Law Center, Date posted to database: November 3, 2012 Last Revised: November 3, 2012
7	39	Fiduciary Duties and Exculpatory Clauses: Clash of the Titans or Cozy Bedfellows? Louise L. Hill, Widener University School of Law, Date posted to database: November 29, 2012 Last Revised: November 29, 2012
8	38	Would Enactment of the Uniform Premarital and Marital Agreement Act in All Fifty States Change U.S. Law Regarding Premarital Agreements? J. Thomas Oldham, University of Houston - Law Center, Date posted to database: December 9, 2012 Last Revised: December 9, 2012
9	36	Sex Post Facto: Advising Clients Regarding Posthumous Conception Benjamin C. Carpenter, University of St. Thomas School of Law (Minnesota), Date posted to database: December 4, 2012 Last Revised: December 8, 2012
10	35	LGBT Issues and Adult Guardianship: A Comparative Perspective Nancy J. Knauer, Temple University - James E. Beasley School of Law, Date posted to database: November 9, 2012 Last Revised: November 9, 2012

CLE on Tax Issues Involving Decanting Irrevocable Trusts

The ALI-CLE is sponsoring a telephone seminar/audio website entitled, Tax and Non-Tax Aspects of Decanting Irrevocable Trusts, on Tuesday, January 15, 2013 from 1:00 - 2:30 p.m. EST. Provided below is description of the event:

Decanting is an increasingly popular strategy among estate planning practitioners to restructure otherwise irrevocable truts to accomplish a variety of tax and non-tax objectives for their clients.

In this 90-minute program, you will learn from some of the nation's top practitioners the principal circumstances in which decatning is an appropriate strategy. The panelists will discuss practical and jurisdictional issues, which a particular emphasis on how decanting can be used to avoid or resolve trust disputes among trust beneficiaries. The panelists will also address the likely tax consequences of decanting based upon the most compelling commentaries that have been submitted to the IRS to date.

Summary of the Scope of Congressional Proposals For the Estate Tax

As I have previously discussed, members of Congress and the President have made numerous proposals on how the estate tax should change. Even though this one of the items that is making talks difficult in the Senate at the moment, it is important to remember that for the vast number of citizens in this country the outcome of this issue will not affect them at all. According to the Washington Post, "About 99.9% of deaths do not involve people with estates large enough to be taxed." Still, let's examine the scope of the various proposals made by key members of the fiscal cliff talks.

Republicans in Congress would like to the sustain the Bush-era tax cuts and keep the lifetime gift tax exemption and estate tax rate at their current levels. Under this arrangement, the exemption sits at $5 million with the current estate tax at 35%. At these levels, only 3,800 households will likely to be affected by the estate tax.

President Obama would like to decrease the exemption to $3.5 million and increase the tax rate to 45%. Under the President's proposal, 6,500 households will likely be affected by the estate tax.

If not action is taken, the exemption and tax rate will return to their Clinton-era levels of $1 million with a 55% tax on all income that exceeds that amount. At these levels, it is estimated that the tax will affect more than 40 million Americans.

See Zachary A. Goldfarb, The Estate Tax: A Primer, The Washington Post, Dec. 30, 2012.

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

Estate Planning Lessons From Norman Schwarzkopf

I have frequently blogged about lessons that we can learn from the death of celebrities. Recently, Norman Schwarzkopf, the commander of coalition forces in Operation Desert Shield, passed away from complications with pneumonia.  There are two main lessons to take from his estate planning.

First, legacy and reputation are just as important in planning an estate as what to do with the physical and monetary assets. After his time in the Gulf War, Schwarzkopf was able to become an author, speaker, and live a private life with his wife and children.  He stayed out of the public eye despite offers to enter into politics and he was able to keep the positive legacy that he earned during his military career.  Passing on that good family name could be just as important as passing on an Evan Guthrie Law Firm inheritance. 

Second, every veteran should be knowledgeable of the benefits that are available to them. One does not have to be a general to take advantage of benefits. The US Department of Veterans Affairs or an elder law or veteran's attorney can help to identify what options any given veteran may have. 

See Evan Guthrie Law Firm, Estate Planning: Lessons Learned From Norman Schwarzkopf, JDsupra, Dec. 28, 2012.  

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

New Cause of Action in China For Elderly People to Sue Children

On Friday, China's national legislature amended their laws to require adult children visit their aged parents "often" or risk being sued by them.  The amendment does not specifically state what constitutes "often," but state media says that the new clause allows elderly parents who feel neglected by their children to take them to court.  

The rapid rate at which China is developing is creating difficulties in caring for its aging population.  Market reforms have accelerated the breakup of the traditional extended family in China and there are few affordable alternatives for the elderly to live on their own.  Additionally, the increase in life expectancy coupled with the family planning policies that limit most families to a single child has made supporting the growing number of elderly more difficult as the working population shrinks.

See China Passes Law Requiring People to Visit Their Elderly Parents or Risk Being Sued by Them, The Washington Post, Dec. 28. 2012.  

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

Reminder: CLE on Divorce and Trusts

The ABA Section of Family Law, Solo, Small Firm and General Practice Division, Young Lawyers Division and the Center for Professional Development will host a 90-minute live webinar and teleconference entitled, Divorce and Trusts: How to Effectively Represent Your Client from 12:00 p.m. to 1:30 p.m. central standard time on Wednesday, January 16, 2013. Provided below is a description from the ABA website:

Join our panel of family law and estate planning practitioners who will cover the complicated issues that can arise during divorces when trusts are involved.  

Topics to be addressed:

• Whether assets held in trust can be considered marital property and if the assets are subject to distribution
• Whether a spouse can be compelled to pay alimony or child support because he or she is the beneficiary of a trust
• Whether a trust itself can be compelled to make the payments

When these issues arise in divorce, they can have a significant impact on the outcome of the matter.