Wills, Trusts & Estates Prof Blog

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

Monday, November 26, 2018

10 Tips to Help Protect Your Spouse

Heart-made-small-hearts-vector-32804992Married couples promised to love each other until death do they part, but there is a way for you to protect your spouse even after you pass away.

  • Gather financial papers and important documents and store them in a fireproof box.
  • Make a "must call" list comprised of your accountant, lawyer, and other important numbers.
  • Keep a master list of passwords and usernames.
  • Make sure beneficiaries are up to date.
  • Check credit cards to make sure either both names or just one name are on the accounts, in line with you and your spouse's wishes.
  • Set up advance directives.
  • Designate a power of attorney.
  • Regularly review wills and trusts.
  • Discuss funeral arrangements and plans with each other.
  • Learn how bills are paid - and make sure the other spouse knows how as well so there are no late payments.

See Leslie Milk, 10 Tips to Help Protect Your Spouse, AARP, November 11, 2018.

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

November 26, 2018 in Current Events, Death Event Planning, Elder Law, Estate Administration, Estate Planning - Generally | Permalink | Comments (0)

Planning for a Hobby that Costs Almost as Much as Children

HorsesThere is an estimated 2 million horse owners in America, and millions more are affiliated in the equestrian industry as employees, volunteers, and service providers. These clients have a special set of financial needs. The hobby may be expensive, but any horse lover will tell you that it is worth it and there is no going back.

How to build a plan for a horse enthusiast without scrimping on the client’s own long-term care, retirement, family and other needs? One must consider the expenses of riding lessons, purchasing a horse, boarding, vet bills, farrier bills, dentist bills and show costs, among many others. Clients can spend between $6,000 and $25,000 per year, per horse depending on depending on circumstances. “Horses can live 30 years, and depending on the kind of owner, they could be making a longer financial commitment than to a child," says California-based advisor Brooke Salvini of Salvini Financial, who is also an equestrian.

Like children, horse take a considerable amount of time and expense. They require regular dental check-up, medical appointments, and re-shoeing for developing hooves - the horses, not the children. “Some [clients] can easily afford the activities, while others need to prioritize and plan to be able to meet their retirement goals," says California-based Wells Fargo advisor Sandra McPeak.

Avid horse owners also need to be aware of changes in the tax code that could effect their expenses year-to-year as well as the transfer of their precious animals at the end of their life. For the first time ever, an owner’s qualified business income from a pass-through is allowed a 20% deduction. Additionally, the modified estate tax will reduce the number of family businesses that are susceptible to it.

See Amanda Schiavo, Planning for a Hobby that Costs Almost as Much as Children, Financial Planning, September 11, 2018.

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

November 26, 2018 in Current Affairs, Estate Planning - Generally, Estate Tax, Income Tax, New Legislation, Sports, Wills | Permalink | Comments (0)

Sunday, November 25, 2018

Call for Papers: Empirical Analysis of Wealth Transfer Law


The University of California, Davis School of Law (King Hall) and The American College of Trust and Estate Counsel’s Legal Education Committee are happy to announce that the 8th ACTEC academic symposium will be held on Friday, October 11, 2019. The theme is Empirical Analysis of Wealth Transfer Law. The event’s goals are to bring together established and emerging scholars and to foster discussion about empirical scholarship about wills, nonprobate transfers, intestacy, inheritance taxation, and related issues.

Articles presented at the symposium will consist of those selected from this Call for Papers and those from invited speakers. All papers will be published by the UC Davis Law Review.

If you would like to be considered to present a paper, please email an abstract of no more than two pages to Professor David Horton (dohorton@ucdavis.edu) by March 1, 2019. The Law Review will notify those selected by March 15, 2019. Please be aware that speakers must submit drafts that are ready for the editing stage of the production process by mid-November 2019.

Speakers will be reimbursed for their reasonable travel expenses (economy airfare, ground transportation, and up to two nights in a local hotel). Speakers will also be invited to dinner on Friday, October 11. Breakfast and lunch will be provided to speakers and attendees on October 11 courtesy of the ACTEC Foundation. Questions about the symposium or this Call for Papers should be directed to David at the email address above or Professor Adam Hirsch (ahirsch@sandiego.edu).

November 25, 2018 in Conferences & CLE, Scholarship | Permalink | Comments (0)

CLE on Planning Techniques for Large Estates: Your Secrets Are Safe with Me (I Think) - Protecting Privilege When Planning for Estates

CLEThe American Law Institute is holding a webcast entitled, Planning Techniques for Large Estates: Your Secrets Are Safe with Me (I Think) - Protecting Privilege When Planning for Estates, Thursday, December 20, 2018 at 12:00 p.m. - 1:00 p.m. Eastern. Provided below is a description of the event.

Why You Should Attend

Like communications between any client and attorney, communications between a client and an estate planning practitioner may be covered by the attorney-client privilege. The estate planning process entails the sharing confidential information, but clients often take the privilege for granted, without realizing that not all communications are privileged and that in certain situations, the privilege can be waived.  

What You Will Learn

Join us to learn the nuances of attorney-client privilege in estate planning practice, steps to protect your client’s confidential information, and best practices for keeping your professional reputation intact. Using fact illustrations, this webcast will explore:  

Attorney-Client Privilege: What Is It and How Does It Apply to Estate Planners? (Rule 1.6, Rule 1.1)

Work Product Doctrine: Where Does It Come Into Play?

Working With Third Parties: How Does It Impact the Privilege?

  This practical ethics session was originally presented on April 27, 2018, at the ALI CLE course, Planning Techniques for Large Estates. The discussion is relevant to practitioners handling estates of all sizes. Register now and get a front row seat at the rebroadcast!   Questions submitted during the program will be answered by email within two business days after the program. In addition, all registrants will receive a set of downloadable course materials to accompany the program.   Need this information now? Purchase the on-demand course here.  

Who Should Attend

Estate planners handling estates of all sizes will benefit from this ethics program from ALI CLE.  
Register two or more and SAVE! Register as a group for this program and save up to 50%. Click on "Group Rates" for more information. (Offer valid on new registrations in the same delivery format; discounts may not be combined.)

November 25, 2018 in Articles, Conferences & CLE, Estate Administration, Estate Planning - Generally, Estate Tax, Professional Responsibility | Permalink | Comments (0)

Who Can Set Up the ABLE Account?

Gavel-simpleABLE accounts were Congress via the passage of the Achieving a Better Life Experience (ABLE) Act in 2014 and allow people with disabilities to save for disability-related expenses while maintaining eligibility for government benefit programs such as Social Security and Medicaid. A person can save up to $15,000 per year and a maximum of $100,000.

But who can open an account for the disabled person? Family members? The parents? Or in certain circumstances, the disabled person? ABLE accounts can be set up either by the account beneficiary (the person with disabilities), or that person’s parent, legal guardian or another person with power of attorney. If the beneficiary is opening an account, they must be 18 years or old and have the cognitive ability to understand what they are doing.

One big hindrance, however: the disability must have begun before the age of 26. This excludes many individuals that have become disabled later life, whether by a physical accident, medical condition, or neurological disease. Both houses of Congress have the ABLE Age Adjustment Act in front of them, which would increase the age of onset from 26 to 46.

See Who Can Set Up the ABLE Account?, ElderLawAnswers.com, November 12, 2018.

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

November 25, 2018 in Current Affairs, Disability Planning - Health Care, Disability Planning - Property Management, Estate Planning - Generally | Permalink | Comments (0)

Saturday, November 24, 2018

Why We Think ESG is a Bedrock Investment Issue

Piggy-on-top-300x199The investment interest around environmental, social, and governance (ESG) criteria is growing among a wide variety of investors. This is not surprising, as in many ways they are the most foundational or bedrock investment issues. They matter in a real economic sense.

The Global Equity Team members at OppenheimerFunds seek to be long-term investors in above-average businesses that have significant competitive advantages, and that are beneficiaries of structural shifts in economic growth, technology, and demographics. In our experience, long-term value creation is not possible for companies entangled with ESG controversies. British Petroleum (BP) and its shareholders saw a $50 billion loss after the 2010 Deepwater Horizon spill.

The durability and trajectory of any given set of business economics can be enhanced or hindered by corporate performance on these criteria, and that is why we spend considerable time on ESG-related investment considerations. They have always been relevant, and they will continue to be so.

See Geogre Evans, Why We Think ESG is a Bedrock Investment Issue, Forbes, August 15, 2018.

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

November 24, 2018 in Current Affairs, Current Events, Estate Planning - Generally | Permalink | Comments (0)

Article on Estate Law--Balancing the Competing Interests of Efficiency, Finality, and Freedom of Disposition in Ancillary Administration Proceedings: Lon V. Smith Foundation v. Devon Energy Corp., 2017 WY 121, 403 P.3d 997 (Wyo. 2017)

WyKaylee Harmon recently published a Case Note entitled, Estate Law--Balancing the Competing Interests of Efficiency, Finality, and Freedom of Disposition in Ancillary Administration Proceedings: Lon V. Smith Foundation v. Devon Energy Corp, 2017 WY 121, 403 P.3d 997 (Wyo. 2017), 18 Wyo. L. Rev. 379-406 (2018). Provided below is the introduction of the Case Note.

Although you cannot take it with you when you go, American succession laws permit the next best thing—the power to decide who will receive your possessions when you are gone. This notion of fulfilling donative intent permeates American probate laws, and its breadth is nearly unparalleled by any other modern legal system. Policymakers have gone to great lengths to ensure that probate procedures accommodate the freedom of disposition, only permitting outright restraints in certain limited circumstances. So, testators can rest easy knowing their property will be dispersed according to their wishes, right? Unfortunately, there may still be cause for concern. Over time, states have unwittingly undermined donative intent by attempting to balance the freedom of  disposition with other interests. This has called into question the legitimacy of the American premise that “freedom of disposition is paramount and the courts have no power to deviate from a person’s will.”

The Wyoming Supreme Court recently grappled with this dilemma in the context of ancillary probate administration. In Lon V. Smith Foundation v. Devon Energy Corp., the Wyoming Supreme Court settled a controversy between named beneficiaries as to the rightful ownership of certain Wyoming real property listed within a testator’s will. The dispute resolution focused primarily on a determination of which instrument—the testator’s will or a conflicting foreign decree adopted during ancillary probate administration proceedings—governed the disposition of the estate’s assets. This case presented an opportunity for the Wyoming Supreme Court to examine the interplay between Wyoming’s interest in upholding the freedom of disposition and the efficient operation of ancillary probate proceedings under Wyoming Statute § 2-11-201.T he court ultimately concluded that the foreign probate decree adopted by the Natrona County District Court pursuant to Wyoming Statute § 2-11-201 controlled the distribution of Wyoming real property, notwithstanding the decree’s failure to distribute the real property in accordance with the testator’s will.

This case note examines concerns stemming from the operation of Wyoming ancillary probate statutes as seen through the Wyoming Supreme Court’s holding. It first provides a brief description of the history behind Wyoming probate laws, followed by a discussion of the ancillary administration proceedings available in Wyoming. Next, it gives a summary of the facts, holding, and analysis in Lon V. Smith Foundation v. Devon Energy Corp. It argues the court’s holding in Lon V. Smith Foundation was correct based upon the present language of Wyoming Statute § 2-11-201 and general probate principles. However, this case note further argues that Wyoming Statute § 2-11-201, as applied, incorrectly favors efficiency at the expense of accurately fulfilling the testator’s intent. Finally, this case note examines the legislative response to the principal case’s application of Wyoming Statute § 2-11-201 and proposes an amendment to the statute.

November 24, 2018 in Articles, Current Events, Estate Administration, Estate Planning - Generally, New Cases, Trusts | Permalink | Comments (0)

Friday, November 23, 2018

Farm Succession Planning

FarmSuccessful family farms are often the pride of their owners, and they want to pass on the farm to other generations to form a legacy. Unfortunately, only 30% of family owned farms transfer effectively to the next generation. A clear and concise succession plan can alleviate many of these pitfalls, but the majority of farm owners do not go beyond creating a will.

Here are a few suggestions on how to make an effective succession plan for a farm.

  • Organize a team. Get together experts, estate planning attorneys and accountants to create a specialized plan for you and your family.
  • Consider incorporation. Becoming a formal legal entity can help ensure continuation of a business and also provide limited liability for its owners.
  • Train successors well. Training successors will help them love the farm just as you do, and the process can take years.
  • Document a vision. Help future generations understand future goals for the farm set by current owners
  • Develop a buy-sell or stock-restriction agreement. An agreement can obligate one owner to buy and another to sell his or her interest in the farm by a triggering even, just as a death or incapacity. It can also be structured to control how ownership interests may be transferred to non-family or off-farm family members
  • Have an insurance plan. Life insurance can provide needed liquidity when a triggering event such as death brings about sale of an ownership interest
  • Discuss plans with individuals involved. No need to surprise family members or others.
  • Review and update a plan periodically. Changes in laws or tax code may require adjustments to a plan, as well as changes in personal life and family situation also require a plan update.

See Amy E. Ebeling, Farm Succession Planning, Ruder Ware L.L.S.C., November 15, 2018.

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

November 23, 2018 in Current Events, Disability Planning - Property Management, Estate Administration, Estate Planning - Generally, Wills | Permalink | Comments (0)

Thursday, November 22, 2018

Article on Corporate Tax Enforcement Externalities and the Banking Sector

BankJohn Gallemore & Martic Jacob recently published an Article entitled, Corporate Tax Enforcement Externalities and the Banking Sector, Tax Law: Tax Law & Policy eJournal (2018). Provided below is an abstract of the Article.

Governments around the world are considering increasing corporate tax enforcement efforts to mitigate base erosion and improve revenue. Whether such enforcement efforts have externalities is not well known. In this study, we examine whether corporate tax enforcement can affect banks via their corporate lending. Specifically, we hypothesize that tax enforcement efforts aimed at small and midsized enterprises (SME) can improve their information environments, which in turn could lead to better lending decisions and greater commercial loan growth. Exploiting the regional structure employed by the IRS between 1992 and 1999, we find that the corporate tax audit probability for SMEs is associated with greater loan portfolio quality and commercial lending growth for regionally focused banks. We find similar evidence when exploiting the IRS reorganization from a regional to a federal-based system in 2000 as an exogenous change to tax enforcement at the district level. Our findings are consistent with the tax authority’s mandate having important externalities on the banking sector via the latter’s commercial lending, and suggest that the benefits to tax enforcement go beyond simply improving tax collection.

November 22, 2018 in Articles, Current Affairs, Estate Planning - Generally | Permalink | Comments (0)

Stan Lee Estate Tangled by ‘Magic’ of Valuing Stolen-Blood Claim

StanStan Lee, the comic genius behind such heroes as Spider-Man and the Incredible Hulk, passed away on November 12 at the age of 95. One of the many issues with his estate is valuing the lawsuits Lee was a part of at the time of his death, including one suit involving a claim that his blood was stolen and sold without his consent.

His former publicist, Jerardo “Jerry” Olivarez, is accused of transferring millions of dollars from Lee’s bank accounts and  engaging in a scheme to sell Lee’s blood as a collectible. The estate must place a value on the suit so that it can calculate the amount of taxes owed, which must be paid within 9 months of the person's death.

“If the lawsuit has not been resolved prior to the filing of the estate tax return there’s a big, difficult problem in how do you value that possible recovery that you might get some time in the future,” said Donald Perry, chairman of the trusts and estates department at Phillips Nizer LLP. The charges in the lawsuit are now more difficult to prove as the main witness was Stan Lee himself.

Lee’s estate will likely have to deal with other hard-to-value assets such as his postmortem image and likeness rights, especially as it was such a thrill to fans to find Lee's cameos in the Marvel Cinematic Universe films. New technology creates the possibility that those cameos may just continue.

See Allyson Versprille, Stan Lee Estate Tangled by ‘Magic’ of Valuing Stolen-Blood Claim, BNA.com, November 14, 2018.

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

November 22, 2018 in Current Affairs, Estate Administration, Estate Planning - Generally, Estate Tax, Film, New Cases, Technology, Wills | Permalink | Comments (0)