Wills, Trusts & Estates Prof Blog

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

Monday, January 18, 2021

Mickey Mantle baseball card shatters record, sells for $5.2 million

MickeyA Mickey Mantle baseball card sold for $5.2 million, crushing a 5-month-old record for highest-selling sports card of all time. 

The card, a 1952 Topps Mickey Mantle PSA 9—PSA is a grading system used for sports cards with a range from 1-10. The prior record was held by a one-of-one Mike Trout rookie card that sold for $3.94 million in August. Legend has it that there are only 6 PSA 9s of the Mantle card. 

Who purchased the card? Rob Gough, an actor who acquired the streetwear brand Dope in 2017. Gough stated, "The 1952 Topps Mantle is the holy grail of sports cards. As a kid ripping packs in the '90s, I always dreamt of owning one. . . I felt this Mantle was highly underpriced." 

Apparently, thousands of 1952 cards were dumped into the Hudson River in 1960 after overproduction. 

"Since August, Gough has amassed a 1916 Sporting News Babe Ruth rookie, a 1917 Collins-McCarthy Joe Jackson and several PSA 10 Michael Jordan rookie cards among others." 

The sale of the card is just one of many in the recent surge in big-money sports memorabilia—particularly rookie cards. 

See Dan Hajducky, Mickey Mantle baseball card shatters record, sells for $5.2 million, ESPN, January 14, 2021. 

Special thanks to David S. Luber (Florida Probate Attorney) for bringing this article to my attention.

January 18, 2021 in Current Affairs, Estate Planning - Generally, Sports | Permalink | Comments (0)

Thursday, January 14, 2021

Suspension imposed after appeals judge is accused of making himself a beneficiary of ex-client's will

Estate planningThe Georgia Supreme Court has suspended a state appeals judge and is engaging in an ethics investigation. 

The judge, Christian Coomer, allegedly made himself a beneficiary and his wife the executor when drafting wills for a former client. Coomer has also been accused of drafting an irrevocable trust for the client that designated Coomer as the trustee and beneficiary with the power to transfer funds to himself while the client was still alive. 

"A company owned by Coomer is also accused of borrowing $369,000 in a series of three loans from the client, the first of which was paid off on the day that the second loan took effect. Two of the loans listed the client’s own home as security, which Coomer later attributed to a scrivener’s error. The third loan was unsecured. Coomer has since repaid all of the loans." 

Coomer began representing James Filhart, the former client who is now 79-years-old, when Filhart sought guardianship of his girlfriend in a nursing home. 

According to the Georgia Judicial Qualifications Commission, Coomer transferred funds from his campaign account to his law firm account to cover minimal or overdrawn balances.

Coomer agreed to the suspension (with pay), but has denied any wrongdoing. 

See Debra Cassens Weiss, Suspension imposed after appeals judge is accused of making himself a beneficiary of ex-client's will, ABA Journal, January 6, 2021. 

January 14, 2021 in Current Affairs, Current Events, Estate Planning - Generally, New Cases, Wills | Permalink | Comments (0)

Wednesday, January 13, 2021

David Bowie's estate launches a new TikTok account with his iconic hits and music videos to celebrate the late rocker's 74th birthday

BowieDavid Bowie's estate launched a TikTok account on what would have been his 74th birthday. TikTok announced that David Bowie, who died in 2016 at the age of 69, would be celebrated with a new account that will share his back catalog.

Also, Bowie's music will be available to the TikTok community as Bowie's dedicated page will include iconic videos from over five decades in the industry. On January 10th, TikTok launched the Starman challenge to mark the pass of five years since Bowie's death. 

"The hashtag challenges users to celebrate Bowie's life and work by recreating his iconic looks over the years to the track Starman, the lead single from his 1972 album The Rise and Fall of Ziggy Stardust and The Spiders." 

Paul Hourican, Head of UK Music Operations at TikTok stated, "He remains one of the most influential and acclaimed artists of all time and his music has defined multiple generations and cultural moments. We know the excitement our community will find discovering his music and creating using the indisputable Bowie sound." 

See Roxy Simons, David Bowie's estate launches a new TikTok account with his iconic hits and music videos to celebrate the late rocker's 74th birthday, Daily Mail (U.K.), January 8, 2021. 

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

January 13, 2021 in Current Affairs, Current Events, Estate Planning - Generally, Music, Technology | Permalink | Comments (0)

Neil Young has sold a big stake in his 1,180 songs

NeilyoungFolk-rock superstar Neil Young has joined the trend and sold a stake to his music catalog. Young reportedly sold a 50% stake in his catalog to investment company Hipgnosis for an estimated $150 million. The deal covers 1,180 songs. 

Young is only the latest in a number in a number of artists that have decided to sell their rights or at least a portion of them to the highest bidder. 

Neil Young, an influential songwriter, rose to fame in the 1960s and has remained an icon ever since. Young has released to studio albums and is a two-time member of the Rock & Roll Hall of Fame (one as a solo artist and one as a member of Buffalo Springfield). 

Founder of Hipgnosis, Merck Mercuriadis stated, "This is a deal that changes Hipgnosis forever." Mercuriadis is understandably excited for the deal and what is to come of it.

Mercuriadis has been a longtime fan of Neil Young stating, "I bought my first Neil Young album aged 7. 'Harvest' was my companion and I know every note, every word, every pause and silence intimately. Neil Young, or at least his music, has been my friend and constant ever since."

Sounds like the deal was mutually beneficial for all parties!

See Jack Guy, Neil Young has sold a big stake in his 1,180 songs, CNN Business, January 6, 2021. 

Special thanks to Mark J. Bade (CPA, GCMA, St. Louis, Missouri) for bringing this article to my attention. 

January 13, 2021 in Current Affairs, Current Events, Estate Planning - Generally, Music | Permalink | Comments (0)

Tuesday, January 12, 2021

Trump blasts niece's 'conspiracy theories' as he seeks fraud lawsuit's dismissal

TrumpPresident Donald Trump is attempting to get his niece's lawsuit against him dismissed. Donald Trump's niece brought suit against him claiming that he defrauded her out of an inheritance that is worth tens of millions of dollars. Donald Trump has accused her of "embracing conspiracy theories." 

Donald Trump's lawyers claim that Mary Trump gave up her claims in an earlier 2001 settlement with family members. They also claim that Mary has waited too long to accuse Donald Trump and other family members of trying to "squeeze" her out of her inheritance. 

According to the lawyers, “Plaintiff makes outlandish and incredulous accusations in her complaint, which is laden with conspiracy theories more befitting a Hollywood screenplay than a pleading in a legal action.” 

Apparently, the lawsuit was just a ploy to "weaken the President's political influence during his post-presidency by preoccupying him with the defense of innumerable lawsuits." 

See Jonathan Stempel, Trump blasts niece's 'conspiracy theories' as he seeks fraud lawsuit's dismissal, Reuters, January 5, 2021. 

Special thanks to David S. Luber (Florida Probate Attorney) for bringing this article to my attention.

January 12, 2021 in Current Affairs, Current Events, Estate Planning - Generally | Permalink | Comments (0)

Friday, January 8, 2021

Article on Tax Benefits, Higher Education and Race: A Gift Tax Proposal for Direct Tuition Payments

Bridget J. Crawford and Wendy C. Gerzog recently published an article entitled, Tax Benefits, Higher Education and Race: A Gift Tax Proposal for Direct Tuition Payments, Wills, Trusts, & Estates Law ejournal (2020). Provided below is the abstract to the Article. Tax

A tax system should be fair. According to conventional wisdom, this fairness mandate means that similarly situated taxpayers should pay similar taxes. Notably absent from most discussions about tax fairness or equity is any consideration of race. This makes sense, if one focuses on the tax laws’ facial neutrality, as well as the Internal Revenue Service’s failure to collect official data about the race of taxpayers. But if one is interested in equity among taxpayers, we must also examine to what extent different groups of taxpayers benefit from a Code section that reduces their tax liability. In the context of distributional equity, race and other identity characteristics must inform any analysis. This Article intervenes in this discussion with three principal claims: one descriptive, one normative, and one utilitarian.


First, the Article uses data from the higher education sector to demonstrate that primarily wealthy, white taxpayers capture the most generous educational tax benefits. Black taxpayers appear to benefit the least from these tax provisions. Black college graduates have greater education-related debt (both in incidence and quantum) than any other group of their peers. Furthermore Black college graduates have lower average wages and higher rates of unemployment compared to their Asian, Hispanic/Latinx counterparts. Black families are the least likely to be able to contribute to a 529 college tuition savings program or to make tax-free, direct tuition payments. While Black college graduates and families can take advantage of some tax benefits for higher education, the greatest tax expenditures are for those that benefit whites.
The Article next argues that achieving a more racially just society requires attention to the ways that tax laws exacerbate existing race-based economic inequality. This Article uses the example of the gift tax exemption for direct tuition payments to illustrate the ways that tax rules can exacerbate the racial wealth gap. In the context of any tax benefit statute, there are abundant opportunities for future research at the intersection of race and taxation. That work is made more difficult by the absence of readily available tax data on the basis of race, but other data sources can help fill the gaps.
Finally, the Article proposes a test for evaluating the distributional equity of any tax exclusion or deduction that results in an understatement of the donor’s or decedent’s transfer of wealth. Unlike a wealth transfer that is considered an item of consumption, a wealth transfer that has concomitant lifelong benefits, such as direct tuition payments for education, should not be allowed to reduce the donor’s transfer tax base. In the case of wealth transfer taxes, a particular tax benefit is inequitable if (1) it has disparate impacts on the basis of race and (2) the benefit is inconsistent with the overall policy objective of imposing a gift tax on inter vivos transfers that create substantial capital-like advantages to the donee while simultaneously reducing the value of the transferor’s estate. The gift tax exemption for direct tuition payments fails both parts of this test and should be repealed.

January 8, 2021 in Articles, Current Affairs, Current Events, Estate Planning - Generally, Estate Tax, Gift Tax | Permalink | Comments (0)

Thursday, January 7, 2021

Divorces And Marriages Tumbled In U.S. During Covid, Study Shows

DivorceAccording to a new study, divorces and marriages "plummeted" last year. This is not surprising as many weddings were cancelled or postponed due to Covid-19. Bowling Green State University recently completed a study in which they analyzed five states that have released monthly numbers for last year. 

The data from the study contradicts the early predictions that Covid-19 and forced quarantines would cause divorce rates to go up. 

Florida, the largest state analyzed, marriage numbers were 33% lower than researchers would have expected based on previous trends, from March through September. "If trends in Florida and other states -- Arizona, New Hampshire, Missouri, and Oregon -- were repeated nationwide, the U.S. had an estimated “shortfall” of 339,917 marriages and 191,053 divorces, according to the paper by Bowling Green’s Wendy Manning and Krista Payne." 

You may be asking your self, "How is it that couples are happier during one of the toughest years ever?" Well, happiness may not be the reason for the decreased divorce numbers. One likely explanation is that the pandemic "may be forcing dissatisfied spouses to stay together for practical reasons." 

Further, divorce is often expensive and due to the economic uncertainty and danger of impending health issues from Covid-19, couples may be avoiding the turmoil caused by divorce and separation. 

See Ben Steverman, Divorces And Marriages Tumbled In U.S. During Covid, Study Shows, Financial Advisor Magazine, January 5th 2020. 

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

 

January 7, 2021 in Current Affairs, Current Events, Estate Planning - Generally | Permalink | Comments (0)

Tuesday, January 5, 2021

IRS says Prince's estate undervalued by 50%, triggering another dispute in settlement

PrinceAccording to the IRS, executors of Prince's estate undervalued its value by 50%, which equals about $80 million. The miscalculation has lead to another dispute that could prolong the probate proceedings even further. 

The IRS has determined that PRince's estate is worth $163.2 million even though the valuation submitted by Comerica Bank & Trust claimed the value was $82.3 million. 

The IRS claims that Prince's estate owes another $32.4 million in Federal taxes, which is around double the tax bill amount submitted in Comerica's valuation. 

According to Michael Smith, an estate planning Attorney not involved in the case, there is a "large discrepancy in terms of the dollars involved and the fact that the IRS thinks the estate is worth twice as much." The IRS has also fined the estate $6.4 million for a "accuracy-related penalty." 

Comerica and its lawyers, on the other hand, claim that the estate valuations are correct. 

According to Dennis Patrick, another estate planning attorney not involved in the case, "What we have here is a classic battle of the experts — the estate's experts and the IRS' experts."

See Mike Hughlett, IRS says Prince's estate undervalued by 50%, triggering another dispute in settlement, Star Tribune, January 2, 2021. 

Special thanks to Mark J. Bade (CPA, GCMA, St. Louis, Missouri) for bringing this article to my attention. 

January 5, 2021 in Current Affairs, Current Events, Estate Administration, Estate Planning - Generally, Estate Tax | Permalink | Comments (0)

Fluent Cherokee Speakers Are Eligible For Early COVID-19 Vaccinations

Estate planningThere are certain people across the country that are given priority for coronavirus vaccines. Those groups of people include, first responders, medical workers, and others. One of the groups that you may not have thought of are Cherokee speakers. "The Cherokee Nation, based in Oklahoma, offered vaccines to some of the few people who speak its language." 

You may be wondering what the importance is of keeping Cherokee speakers alive. NPR's Steve Inskeep spoke to Media Nix, a Cherokee speaker from Oklahoma who was an early recipient of a vaccine, to discuss that very question. 

Nix actually did not grow up speaking Cherokee, but her mother spoke it around their home. Meda Nix actually didn't begin trying to speak Cherokee until after she retired. Now, Nix teaches Cherokee to a class of fifth-graders. 

Given the low number of Cherokee speakers, it is very important to keep them around in the interest of language preservation. In the wake of Coronavirus, Cherokee speakers are becoming ill and dying so the vaccine is necessary to protect Cherokee speakers and in turn, the Cherokee language. 

See Fluent Cherokee Speakers Are Eligible For Early COVID-19 Vaccinations, NPR, January 4, 2021. 

Special thanks to Carla Spivack for bringing this article to my attention.  

January 5, 2021 in Current Affairs, Current Events, Estate Planning - Generally | Permalink | Comments (0)

Sunday, January 3, 2021

President signs year-end funding, COVID-19 relief legislation; tax provisions are enacted

TaxOn December 27, President Trump signed the Consolidated Appropriations Act, 2021." The legislation includes "over $900 billion fo coronavirus (COVID-19) relief programs, government funding of $1.4 trillion, and myriad tax provisions." 

The legislation includes a tax provision that will allow recipients of Paycheck Protection Program (PPP) loans to deduct related costs. The CARES act will also be extended as well as expanded. 

Tax measures that will result from the new legislation includes:

COVID-Related Tax Relief Act

  • Extension time for repayment
  • Additional 2020 Recovery Rebates
  • Clarification that no deduction is denied, no tax attribute is reduced, and no basis increase is denied by reason of the exclusion from gross income from forgiveness of PPP loans
  • Allowance of an election regarding the tax treatment of certain farming losses for 2018, 2019, and 2020
  • and more

There will always be permanent extensions of temporary provisions and long-term extensions of temporary provisions. Also included will be short-term extensions of temporary provisions. 

There are also numerous miscellaneous tax provisions that include: 

  • Modifications to the low-income housing tax credit rate, including a new minimum rate of 4% for certain buildings
  • Depreciation of certain residential rental property over 30-year period, allowing for the use of 30-year ADS depreciation for residential real property placed in service prior to January 1, 2018, held by an electing real property trade or business in certain circumstances
  • Expansion of current section 48 energy credit to include waste “energy recovery property”
  • Extension of current section 48 energy credit for offshore wind facilities to January 1, 2026
  • Minimum rate of interest for certain determinations related to life insurance contracts
  • Retirement provisions
    • Modification to minimum age for distributions during working retirement
    • Temporary rule preventing partial plan termination
  • Employee retention credit (ERC) and rehiring tax credit
    • Clarifications and technical improvements to the CARES Act employee retention credit, including a clarification regarding the definition of “gross receipts,” a modification to the treatment of health plan expenses, and improved coordination with the PPP
    • Extension of the ERC to July 1, 2021, and expansions including increase in the credit percentage from 50% to 70%, increased per employee limitation, and modifications to the definition of eligible employer
  • Business meals deduction—a temporary allowance of a full deduction for business meals paid or incurred between December 31, 2020, and January 1, 2023
  • Earned income tax credit and child tax credit—a temporary special rule for determination of earned income
  • Charitable contributions
    • Extension of the CARES Act non-itemizer charitable contribution deduction for certain contributions through 2021
    • Extension of the CARES Act modification of donor percentage-of-income limitations for certain charitable contributions through 2021
    • For corporations, a temporary suspension of limitations on the deduction for charitable contributions associated with qualified disaster relief made from January 2020 through late February 2021
  • Health and dependent care flexible spending arrangements, temporary special rules for health and dependent care flexible spending accounts with unused balances
  • Life insurance—reduce the required interest rates used to determine if a policy meets the definition of life insurance for federal tax purposes

Special thanks to Mark J. Bade (CPA, GCMA, St. Louis, Missouri) for bringing this article to my attention. 

January 3, 2021 in Current Affairs, Current Events, Estate Planning - Generally, Estate Tax, Gift Tax, Income Tax, New Legislation | Permalink | Comments (0)