Wills, Trusts & Estates Prof Blog

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

Friday, August 31, 2018

CLE on Ethical Hazards of Digital Assets: What Estate Planners Need to Know

CLEThe American Law Institute is holding a webcast / telephone seminar entitled, Ethical Hazards of Digital Assets: What Estate Planners Need to Know, on Thursday, September 13, 2018, at 12:00 pm - 1:30 pm Eastern. Provided below is a description of the event.

Why You Should Attend

More and more of your estate planning clients now have digital assets – from social media profiles to cloud storage to online investment accounts and more. After a decedent dies or an individual becomes incapacitated, however, fiduciaries often have difficulty accessing and managing these assets due to encryption, secret passwords, and federal and state data privacy laws.   As a trusts and estates attorney, you are ethically obligated to understand digital technology and what the challenges are. Do you know as much as you should, as well as what steps your client needs to take to ensure that their electronic assets will be managed or disposed of appropriately? Join us for this 90 minute audio webcast to confirm that you are meeting your ethical obligations AND are providing your clients with superior counsel in this emerging area!  

What You Will Learn

A panel of experienced practitioners – all members of the American College of Trust and Estate Counsel (ACTEC) – will discuss:

- The attorney’s ethical obligation for:

o   technological competence

o   protecting client data and securing files

- The status of the Uniform Fiduciary Access to Digital Assets Act and state adaptations of it

- What kinds of documents should be drafted to account for digital assets

  All registrants will receive a set of downloadable course materials to accompany the program.   Need ethics credit? This seminar provides 1.5 to 1.8 hours of ethics instruction, depending on state requirements, in MCLE jurisdictions that accredit live telephone seminars and/or webcasts.  

Who Should Attend

Attorneys and other legal professionals in Estate Planning should attend this accredited continuing legal education program from ALI CLE.

August 31, 2018 in Conferences & CLE, Estate Planning - Generally, Technology, Trusts, Wills | Permalink | Comments (0)

More Life Insurance Coverage Can Help Protect Your IRA

IraEd Slott, an expert on IRAs, has pointed out that life insurance is not only "the single biggest benefit in the tax code"; it is also "the most cost effective way to protect a large IRA." Many people make the maximum contributions to their IRA plans, and it makes sense to buy additional permanent life insurance to provide additional tax benefits.

If you are in retirement and are required to make withdrawals from your assets to meet normal living expenses, using the cash value from your insurance policies is more cost-effective than withdrawing funds from taxable retirement funds. These types of withdrawals will have no impact on your tax bracket.

Another advantage of buying more life insurance is that it can give some leeway to a surviving spouse to convert a regular IRA into a Roth IRA and the spouse can use life insurance to fund a trust. The use of an IRA would have required minimum distribution requirements and tax implications. Life insurance proceeds are more flexible than other alternatives from a planning perspective,

See Elliot Raphaelson, More Life Insurance Coverage Can Help Protect Your IRA, Chicago Tribune, August 22, 2018.

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

August 31, 2018 in Current Affairs, Elder Law, Estate Planning - Generally | Permalink | Comments (0)

Article on Wills Without Signatures

Will and testamentDavid Hurton recently published an Article entitled, Wills Without Signatures, Wills, Trusts, & Estates Law eJournal (2018) Provided below is an abstract of the Article.

We think of an unsigned “will” as an oxymoron. Since 1837, the Wills Act has required testators in Anglo-American legal systems to memorialize their last wishes in a signed writing. But recently, several American states have adopted an Australian innovation called harmless error, which validates a botched attempt to make a will if there is strong evidence that a testator intended it to be valid. Thus, in these jurisdictions, the testator’s signature is no longer mandatory. Meanwhile, decedents have started making wills in formats that do not permit “wet” signatures, such as e-mails, text messages and word processing files. These trends raise the same question: when, if ever, can a testator assent to a will through her words or conduct? This Article explores the topic of wills with missing or unorthodox signatures. It begins by analyzing a neglected body of precedent on point that spans centuries and countries. First, before the Wills Act, testators could bequeath personal property in unsigned writings. Accordingly, ecclesiastical courts in England and early American judges routinely decided whether a decedent had approved of an unexecuted dispositive instrument. Second, and more recently, dozens of Australian courts have considered whether to apply harmless error to unsigned and electronic wills. These cases, which have reached wildly different conclusions, vividly illustrate the costs and benefits of relaxing the signature requirement. The Article then draws insights from the unsigned will jurisprudence to propose a partial exception to the signature mandate. Traditional law treats the absence of a signature as conclusive proof that a decedent lost her nerve or changed her mind. However, the unsigned will cases reveal that the true culprit is often the fact that a person passed away or lost mental capacity shortly before she could put pen to paper. Accordingly, under what the Article calls the “momentum theory,” courts should enforce written expressions of dispositive wishes when there is clear and convincing evidence that a testator was on the verge of executing a will that memorialized them. This safe harbor for testators whose estate planning efforts were interrupted by forces outside of their control would improve outcomes in several common (or soon-to-be common) kinds of disputes, including those involving notes for future wills, drafts that the testator never read, and digital documents.

August 31, 2018 in Articles, Current Affairs, Estate Planning - Generally, Wills | Permalink | Comments (0)

Fore! California Court Drives Away Claim that Trustee’s Attorney Breached Trust

GolfingChristina Cortese is the biological daughter of Francesca Naify and the stepdaughter of Robert Naify, and after the death of her mother Francesca, she inherited a "modest" amount. Under the advice of attorney Sherwood and the promise by her stepfather that she would inherit a 250-acre golf course, she terminated her mother's trust. Cortese was shocked when she was not a beneficiary of Robert Naify's estate.

She sued Sherwood in San Francisco County Superior Court, alleging breach of trust and claiming that Sherwood assisted Robert in effectuating a plan of “withholding community property from Francesca’s estate, devaluing Francesca’s estate, mismanaging her trust, and terminating it in a manner that benefited Robert.”

The appellate court looked at the factual allegations to determine whether she had alleged a conspiracy within the meaning of Civil Code section 1714.10. The court could not “conceive how Sherwood could have participated in Robert’s alleged breaches of fiduciary duty without an implied agreement to do so.” Because of the statutory requirements, she was required to seek a judge's permission to file the claim, and as she failed to do so the appellate court found her claim legally insufficient.

See Jeffrey S. Galvin, Fore! California Court Drives Away Claim that Trustee’s Attorney Breached Trust, Trust on Trial, August 27, 2018.

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

August 31, 2018 in Current Events, Estate Administration, Estate Planning - Generally, New Cases, Travel, Trusts | Permalink | Comments (0)

Thursday, August 30, 2018

Why It’s Smart to Plan Your Own Funeral—Now

Calla-liliesDeath is not a happy, pretty subject. Facing your own mortality can be one of the hardest trials you can face, but hesitating had the propensity to add stress and costs to those closest to you. Here are several reasons why planning your funeral now is an investment in your life.

  • Rising Costs
    • Planning and paying for your funeral now is a way to avoid the increasing costs of funeral expenses.
  • The Ability to Make Your Own Decisions
    • If you approach funeral planning as you would a financial or business decision, you will have the ability to decide for your family the important aspects of your final event.
  • To Lessen Future Family Conflict
    • While you can’t guarantee family members will abide by your choices, preplanning documents your wishes and provides a benchmark
  • To Reduce Financial Burden
    • Prepaying for your funeral and associated costs eliminates or reduces the financial burden on those left behind.
  • Preplanning is a Gift to Loved Ones
    • Planning a funeral is often left to grieving survivors, and the stress of getting that important even exactly right can just compound onto the mourning process.

See Candy Arrington, Why It’s Smart to Plan Your Own Funeral—and do it Now, Market Watch, August 29, 2018.

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

August 30, 2018 in Current Affairs, Death Event Planning, Estate Planning - Generally | Permalink | Comments (0)

CLE on Getting Money Out of Trusts: Drafting and Trust Administration Under UFIPA

CLEThe American Law Institute is holding a webcast or telephone seminar entitled, Getting Money Out of Trusts: Drafting and Trust Administration Under UFIPA, on Wednesday, September 26, 2018, at 12:00 – 1:30 p.m. Eastern. Provided below is a description of the event:

Why You Should Attend

You Say Income, I Say Principal I Say Principal, You Say Adjust But We Need Not Call the Whole Thing Off*   The all new Uniform Fiduciary Income and Principal Act (UFIPA) features a more robust power to adjust and a comprehensive unitrust regime that will help trustees in the timeless quest for fairness. It also provides interesting income tax planning opportunities that reward the thoughtful and prepared. Although UFIPA largely retains traditional default rules for determining income and principal, the rules for certain key asset classes, like business assets and retirement benefits, have been rewritten for clarity and comprehensiveness.   Don’t miss your opportunity learn from a sophisticated panel of practitioners at this first nationwide, in-depth discussion of an important new development in the trust and estates world.   (* With many apologies to George and Ira Gershwin…)  

What You Will Learn

A faculty of highly accomplished estate planning practitioners and ACTEC Fellows – all directly involved in drafting UFIPA – will discuss this important new Act and its impact on trust administration, drafting, and planning, including:  

The power to adjust

Unitrust conversions

Drafting for fairness and fiduciary income tax planning

Distributions from business entities

Business interests and IRAs

  All registrants will receive a set of downloadable course materials to accompany the program.  

Who Should Attend

All estate planners will benefit from listening to this audio webcast from ALI CLE and ACTEC.

August 30, 2018 in Conferences & CLE, Current Affairs, Estate Administration, Estate Planning - Generally, Trusts | Permalink | Comments (0)

Caring for Aging Parents - When the Child Watches Over the Parent

ManhattanTracey Dewart faced a daunting task last summer: moving her 84-year-old mother who suffered from Alzheimer's, Aerielle, from her Manhattan apartment to an assisted living facility in Brooklyn to be reunited with Tracey's father. To help pay for her mother’s care, Ms. Dewart relied on an investment account at J.P. Morgan Securities that her father had opened eight years prior. But Ms. Dewart found that the account had been charged around 10 times the commission that an account of that size should have been charged.

Ms. Dewart found that Trevor Rahn, the broker who handled her father's account, had sold two-thirds of the portfolio in one month, and then reinvested most of the proceeds, yielding about $47,600 in commissions, according to her attorney. A statement listed all 344 trades that month as “unsolicited” — meaning that they were the customer’s idea, not the broker’s. But Ms. Dewart, who handled authorizations for the account, said that she had not given Rahn permission for those trades.

Ms. Dewart considered taking J.P. Morgan to arbitration as allowed by the customer agreement, but she settled instead for a sum that she is prohibited from discussing.

There exists a murky regulatory territory that brokers inhabit - they are not necessarily fiduciaries, meaning they do not always have to act in a client’s best interest. Typically, brokers only have to recommend investments that are “suitable,” a lower standard.

See Tara Siegel Bernard, Caring for Aging Parents, With an Eye on Their Broker Handling Their Savings, New York Times, August 24, 2018.

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

August 30, 2018 in Current Affairs, Estate Planning - Generally, Professional Responsibility | Permalink | Comments (0)

Article on Social Media Abuse in Long-Term Care Facilities: Why the Law is Failing to Protect Elderly Residents and How States Should Address It

SnapBreanne Hitchen recently published an Article entitled, Social Media Abuse in Long-Term Care Facilities: Why the Law is Failing to Protect Elderly Residents and How States Should Address It, 49 U. Tol. L. Rev. 141 (2017). Provided below is an abstract of the Article:

In March 2016, state health officials in Iowa received a report that a certified nursing assistant for a long-term care facility shared an indecent photo of an elderly resident on Snapchat--with six of the nursing assistant's colleagues. The photo displayed the resident with his pants around his ankles, and his legs and hands covered in feces. Yet, the most disturbing part of the official's investigation was that the nursing assistant's actions were not against the law. Even though the elderly resident had dementia, and the humiliating photo was shared with a larger audience on social media, the state could not punish the nursing assistant criminally. The Iowa law intended to protect elderly adults from abuse in long-term care facilities had not been updated since 2008--before social media use exploded and mobile applications became available. The law would have applied had the resident's genitals been exposed in the photo, but that was not the case. Although the facility fired the nursing assistant, she can still be employed by any other long-term care facility in the state.
Social media use has had a profound impact on human communication and interaction. Using a smartphone, people are able to access social media platforms to simultaneously connect and share personal thoughts or photos with virtually anyone, at any given time. But the removal of communication barriers has led to a breakdown of personal barriers, causing people to over-share details about their personal, and even professional, lives. As a result, victimization through online public shaming has substantially increased. Taking an embarrassing or funny photo of a stranger and then sharing it on social media has become all too common. Yet, most people fail to perceive the harm done to the victim when embarrassing photos are shared online.
Unfortunately, between January 2012 and August 2016, there were 47 documented incidents of long-term care facility employees sharing photos or videos of elderly residents on social media. While these incidents are certainly humiliating and inappropriate, they are also abusive invasions of the resident's privacy. The harm that results from an invasion of privacy extends beyond mental anguish; social media abuse compromises the trust placed in facility staff by the vulnerable elderly residents and their family members.
Currently, most federal and state laws do not allow prosecutors to pursue justice for elderly victims in social media abuse cases. Although there are federal health laws that could potentially apply to nearly every reported incident, the appropriate federal agencies have not taken the necessary actions to enforce those laws, in spite of at least one U.S. Senator's calls for increased federal oversight in this area. Ultimately, states are left to oversee and investigate incidents that occur in facilities in their state. Many states, like Iowa, are quickly discovering that they do not have laws to adequately address privacy violations occurring in long-term care facilities. Moreover, state laws in this area vary considerably from state to state.
This Comment argues that current federal and state statutes and regulations do not adequately address social media abuse of elderly long-term care facility residents, and proposes that states should adopt criminal statutes to punish the act of capturing and disseminating inappropriate images of elderly residents on social media. Part II provides a description of the growth of social media, relevant types of social media used in elderly victimization, and the issues social media use has created in society, including increased victimization. Part III explains the status of the laws and regulations regarding elderly abuse in long-term care facilities and victimization through social media abuse. Part IV highlights how current federal and state laws and regulations are failing to adequately curtail victimization of the elderly, recommends preliminary steps that can be taken to meet that end, and proposes that states adopt criminal statutes to punish facility staff members that commit social media abuse. Part V concludes.

August 30, 2018 in Articles, Current Affairs, Current Events, Elder Law, Estate Planning - Generally, Technology | Permalink | Comments (0)

Wednesday, August 29, 2018

CLE on How to Handle the Probate Process

CLEThe National Business Institute is holding a conference entitled, How to Handle the Probate Process, on Thursday, September 13, 2018, at the Holiday Inn Express Charleston-Civic Center in Charleston, West Virginia. Provided below is a description of the event:

Program Description

A Comprehensive Guide to Probate

Are you confident you can handle a probate case when it lands on your desk? Are you familiar with the proper procedures to use along with the applicable laws? This insightful course will give you detailed, step-by-step information to proficiently navigate through the process - register today!

  • Walk through the initial steps of opening a probate case with tips from seasoned practitioners.
  • Learn how to implement a complete estate timetable in order to know what needs to be done - and when.
  • Effectively guide the executor and the administrator through their various duties in the probate process.
  • Avoid problems arising from creditors' claims and insolvency with our powerful strategies.
  • Discover the secrets to confidently handling a spouse's elective share.
  • Review ways to effectively handle disagreements between beneficiaries and adhere to the guidelines of precedence in case of intestacy.
  • Follow thorough closing procedures so accounting is complete before distribution takes place.

Who Should Attend

This basic level seminar will provide those who have limited probate experience with tips on successfully handling a probate case. This comprehensive seminar will benefit:

  • Attorneys
  • Accountants and CPAs
  • Financial Planners and Wealth Managers
  • Tax Professionals
  • Trust Officers
  • Paralegals

Course Content

  1. Opening the Estate in Probate Court - Initiating the Process
  2. The Personal Representative's Responsibilities
  3. Inventory: Collecting, Maintaining and Managing Assets
  4. Handling Debts and Expenses in Probate
  5. Ethical Issues in Probate
  6. The Spouse's Elective Share and Probate Estate
  7. The Laws of Intestacy and How They May Apply
  8. Closing and Distributing the Probate Estate

Continuing Education Credit

Continuing Legal Education – CLE: 8.00 *

Financial Planners – Financial Planners: 8.00

International Association for Continuing Education Training – IACET: 0.70

National Association of State Boards of Accountancy – CPE for Accountants/NASBA: 8.00 *

* denotes specialty credits

August 29, 2018 in Conferences & CLE, Estate Planning - Generally, Intestate Succession, Professional Responsibility, Wills | Permalink | Comments (0)

IRS Offers Guidance on Switching from S Corp to C Corp Status

CorpThe Internal Revenue Service issued a revenue procedure last week providing information on how companies can change their method of accounting if they have switched from being an S corporation to a C corporation in response to the Tax Cuts and Jobs Act.

Revenue Procedure 2018-44 modifies two revenue procedures from earlier this year, one which clarifies for an eligible terminated S corporation that’s required to change from the overall cash method to an overall accrual method of accounting, and one which clarifies for an eligible terminated S corporation that’s allowed to continue to use the cash method.

To make the change, a business can revoke its S corporation election with the consent of a majority of its shareholders and become a C corp, though it will need unanimous consent if it wants to go back to S corp status.

See Michael Cohn, IRS Offers Guidance on Switching from S Corp to C Corp Status, Accounting Today, August 22, 2018.

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


August 29, 2018 in Current Affairs, Estate Planning - Generally, Income Tax, New Legislation | Permalink | Comments (0)