Wills, Trusts & Estates Prof Blog

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

Tuesday, April 6, 2021

Trump Attacks Niece Mary's Estate-Fraud Claims As Out Of Date

TrumpDonald Trump claimed that his niece Mary's fraud claims against him are "pre-textual." Mary has argued that her lawsuit claiming she was defrauded of "much of her in hesitance decades ago wasn't barred by a two-year statute of limitations. 

Mary Trump recently wrote a tell-all book about her family, in which she claimed her aunt and two uncles "conspired for decades to skim tens of millions of dollars off her inheritance. . ."

Mary claims she did not learn of the alleged fraud until she saw an October 2018 New York Times report on Donald Trump's finances, despite the dispute being settled in 2001. Mary argues that the statute of limitations should run from the article's publication date. 

In a March 25 filing, Donald Trump stated, “A simple reading of the Times article, however, proves this is to be a hollow argument since the vast majority of it has nothing to do with any claim of fraud Plaintiff now posits.” 

Trump also noted that Mary was a source for the Times story and that she provided documents that she received in the 2011 dispute. 

According to Financial Advisor Magazine, "[a] judge may set arguments on the matter before deciding on the motion to dismiss the suit, which names Donald Trump, his late brother Robert and sister Maryanne Trump Barry as defendants." 

See Erik Larson, Trump Attacks Niece Mary's Estate-Fraud Claims As Out Of Date, Financial Advisor, March 29, 2021. 

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

April 6, 2021 in Estate Administration, Estate Planning - Generally, Guardianship | Permalink | Comments (0)

The impact of inheritance

TransferQuite possibly, wealth transfers in the form of a gift could save the middle class. 

Megan is a "farming heiress." Her mom grew up on a wheat farm and the government had been paying her family $15,000 a year to not farm in order to keep the land from being overused. Megan and her mom would receive the money in the form of a yearly gift. 

In 2019, Megan's mother died and now she receives that money directly. Unfortunately, according to Megan, her mom was not great at money management, something she says she inherited from her mother. 

Megan ended up with $50,000 from her mother's estate, which she used to pay off debts. Although Megan is grateful to have received anything from her mother's estate after a "life of financial struggle," $50,000 is not much in the  current economic setting. 

Inheritance is something that will typically come at a terrible time—after the death of a loved one. Conversation surround inheritance is becoming more and more relevant due to the expectance of a great wealth transfer. 

Forbes reports that $30 trillion will transfer from the boomers to the younger generations, while PNC says the amount will be $59 trillion by 2061; CNBC reported that $68 trillion will transfer over 25 years. 

Wealth transfers can come in many forms; monetary gifts with no limitations, tuition payments, loans, just to name a few. 

Given the large, and soon coming generational transfer, it is important to consider and discuss the implications of inheritance. 

See Meredith Haggerty, The impact of inheritance, Vox, March 23, 2021. 

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

April 6, 2021 in Estate Administration, Estate Planning - Generally | Permalink | Comments (0)

Monday, April 5, 2021

Oklahoma Supreme Court: Children Not Mentioned In One-Sentence Holographic Will Are Pretermitted Heirs

Estate planningIn the Matter of the Estate of Chester, the Oklahoma Supreme Court held that "a testator’s son (who had shot the decedent during his lifetime leaving him with life-long injuries) was a pretermitted heir under his father’s holographic will which left the son nothing." 

Buddy Wayne Chester, the decedent, was survived by two adult children, Steven and Lisa. After Buddy died, Lisa was appointed as Special Administrator. 

One day before Lisa filed a number of petitions, Buddy's grandson, Brandon, filed Buddy's probate in Oklahoma County, claiming that Buddy had left a holographic will. Brandon objected to Lisa's filings alleging that Lisa "Was not to be administrator because of her financial issues and damage to estate property, and that Steve should be disqualified as well because he once shot the decedent." 

The holographic will left everything to Brandon and was written entirely in Buddy's handwriting. 

Steven later filed a Motion for Order determining that he was a pretermitted heir. 

The trial court found that the holographic will omitted the son as a beneficiary and that it was not accidental. The Court of Appeals affirmed. 

The Oklahoma Supreme Court held that the two children were pretermitted heirs and that the will does not express the intention to omit to provide for his children. The will was only one sentence long and never used language that expressed that the decedent wanted his children to take nothing. Instead, the decedent did not even acknowledge his kids' existence in the will. 

See Oklahoma Supreme Court: Children Not Mentioned In One-Sentence Holographic Will Are Pretermitted Heirs, Probate Stars, March 30, 2021. 

April 5, 2021 in Estate Administration, Estate Planning - Generally, New Cases | Permalink | Comments (1)

Saturday, April 3, 2021

EXERCISE MAY HELP SLOW COGNITIVE DECLINE IN SOME PEOPLE WITH PARKINSON’S DISEASE

ParkinsonsParkinson's disease can and often does affect thinking and memory skills. Actually, these problems are "among the most common nonmotor symptoms of the disease." "A new study shows that exercise may help slow cognitive decline for some people with the disease." 

Research has also indicated that those with Parkinson's disease who have the gene variant apolipoprotein E e4 or APOE e4, may experience cognitive decline at an earlier, and quicker rate than those without the variant. Also, APOE e4 is known as a "genetic risk factor for Alzheimer's disease." 

The mew study focused on whether exercise could slow down the cognitive decline for people that have the APOE e4 variant. 

According to Jin-Sun Jun, M.D., of Hallym University in Seoul, Korea stated, “[p]roblems with thinking skills and memory can have a negative impact on people’s quality of life and ability to function, so it’s exciting that increasing physical activity could have the potential to delay or prevent cognitive decline.”

Jun also stated that there will need to be more research done in order to confirm the findings, but the results of the research suggests that "interventions that target physical activity" play a role in delaying cognitive decline in people with early Parkinson's who have the APOE e4 gene variant. 

See EXERCISE MAY HELP SLOW COGNITIVE DECLINE IN SOME PEOPLE WITH PARKINSON’S DISEASE, American Academy of Neurology, March 31, 2021. 

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

April 3, 2021 in Estate Planning - Generally, Science | Permalink | Comments (0)

Friday, April 2, 2021

Britney Spears' dad requests pop star to pay nearly $2 million of his legal fees

SpearsBritney Spears' father, Jamie Spears, has requested that the pop star cover his legal fees out of her estate. Jamie Spears has requested nearly $2 million dollars to cover these fees. 

Jamie is also requesting to be paid for the time he spent as Britney's conservator from November 1, 2019 to February 28, 2021. In the court document filing Jamie stated, "I am authorized and allowed to receive compensation through my personal services corporation Spears Management, Inc., for services performed as Conservator of the Estate of Britney Jean Spears, in the amount of $16,000 monthly plus $2,000 monthly for the cost of an office space in a secure location that is dedicated to Ms. Spears' activities."

These requests come after Britney Spears' attorney officially requested that Jodi Montgomery be made her permanent conservator. Britney also asked for her father to resign from his position as conservator. 

See Melissa Roberto, Britney Spears' dad requests pop star to pay nearly $2 million of his legal fees, Fox News, April 1, 2021. 

 

April 2, 2021 in Estate Administration, Estate Planning - Generally, Guardianship, New Cases | Permalink | Comments (0)

U.S. Senate Introduces Legislation for Higher Taxes on Wealth

Wealth taxOn March 25, 2021, Senator Bernie Sanders introduced the For the 99.5 Percent Act (the 99.5 percent Act). The Act looks to modify the estate, gift, and generation-skipping transfer tax. 

If accepted, the Act would "reduce the estate tax exemption, set the gift tax exemption at an amount lower than the estate tax exemption, and increase tax rates on large gifts and estates, effectively returning the gift and estate tax rules to the law in effect in 2009, but with higher rates." The changes would apply to transfers occurring after December 31, 2021. 

Other changes under the Act include: 

  • The estate tax exemption amount would be reduced to $3.5 Million per individual ($7 Million for married couples), with no adjustment for changes in the cost of living. Under current law, the estate tax exemption amount is $11.7 Million per individual ($23.4 Million for married couples), adjusted annually for changes in the cost of living. However, the current exemption amount is scheduled to be reduced by 50% after December 31, 2025. 
  • The amount of the exemption available to shelter lifetime transfers from gift tax would be reduced to $1 Million per individual ($2 Million for married couples), with no adjustment for changes in the cost of living. The portion of the $1 Million exemption used during an individual’s lifetime to shelter lifetime gifts from gift tax would reduce the amount of the $3.5 Million exemption available to shelter transfers at the individual’s death from estate tax. Under current law, the gift tax exemption is the same as the estate tax exemption (and will also be reduced by 50% after December 31, 2025), and any amount not used during an individual’s lifetime is available to shelter transfers at death from estate tax. 
  • The estate tax rate would increase using a progressive tax rate based upon the value of the decedent’s estate:
    • There would be no tax on the first $3.5 Million of the estate.
    • There would be a 45% tax on the estate in excess of $3.5 Million up to $10 Million.
    • There would be a 50% tax on the estate in excess of $10 Million up to $50 Million.
    • There would be a 55% tax on the estate in excess of $50 Million up to $1 Billion.
    • There would be a 65% tax on the estate in excess of $1 Billion.

See U.S. Senate Introduces Legislation for Higher Taxes on Wealth, Greenberg Glusker, March 26, 2021. 

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

April 2, 2021 in Estate Administration, Estate Planning - Generally, Estate Tax, Generation-Skipping Transfer Tax, Gift Tax, New Legislation | Permalink | Comments (0)

Thursday, April 1, 2021

Democrats Weigh Capital Gains Tax Hike For Millionaires At Death

Tax"Senate Democrats are circulating a plan that would trigger tax bills on the assets of the wealthy after they die as the lawmakers seek new sources of revenue to fund trillions of dollars in infrastructure spending and social programs." 

The legislation seeks to end a part of the tax code that allows assets to be passed onto heirs without "immediately generating tax bills." Democrats have long been aiming at these assets to be taxed. Joe Biden's campaign has encouraged the idea. 

Under current tax law, people are able to pass assets to their heirs without transferring capital gains from the property's appreciation, referred to as "stepped up basis at death." Basically, heirs will not have to pay taxes "on any of the gains that accused under the previous owner." 

Under the new plan, taxes would be levied on those assets of the wealthy at death subject to a $1 million exemption. 

According to Chris Van Hollen of Maryland, “The stepped-up basis loophole is one of the biggest tax breaks on the books, providing an unfair advantage to the wealthiest heirs every year. . . “It’s time to stop subsidizing massive inheritances for the rich and start investing in everyday Americans.”

This stepped up basis tax provision has become increasingly popular for the Democratic Party, although, under President Barack Obama, the proposal was blocked by Congress. 

With recent changes in the Senate and the House, it'll be interesting to see where the new proposed legislation goes. 

See Laura Davison, Democrats Weigh Capital Gains Tax Hike For Millionaires At Death, Financial Advisor, March 30, 2021. 

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

April 1, 2021 in Current Events, Estate Planning - Generally, Estate Tax, Income Tax, New Legislation | Permalink | Comments (0)

Wednesday, March 31, 2021

Here's Where The 4% Withdrawal Rate Fails

Estate planning"A 4% retirement asset withdrawal rate remains the standard for financial planning, but it doesn't hold up against every scenario." 

With longevity, volatility, and inflation, the usefulness of the 4% rule for retirement distributions. 

A new white paper that was released by the Alliance for Lifetime Income. The paper is called "Planning for Retirement Income Within a Increasingly Volatile and Uncertain World," and discusses common retirement planning income assumptions. 

The paper was written by Colin Devine and Ken Mungan who stated in the paper, “[t]he results provided by our research and models present substantial cause for concern, particularly within a world where increasing volatility has arguably become the norm.”

The authors of the paper found that, under normal conditions, the 4% rate is strong and "it poses a small 16% risk that retirees will run out of assets within the first 20 years of retirement." 

Devine and Munger found that the 4% rule could be faulty by extending their research beyond the 20-year point in retirement. "In each portfolio allocation assumption, the failure rate of the 4% rule crossed the 50% threshold somewhere between a person’s 30th and 40th year of retirement." 

The authors further mentioned that looking at a person's average life expectancy is not enough since "half of the population could be expected to exceed it. . .Extending the time horizon out to 25, 30, 35 or even 40 years suggests that for each of these time periods there is simply much too high a risk of outliving income.”

See Christopher Robbins, Here's Where The 4% Withdrawal Rate Fails, Financial Advisor, March 8, 2021. 

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

March 31, 2021 in Estate Planning - Generally, Estate Tax | Permalink | Comments (0)

The American College of Trust and Estate Counsel Elects 43 New Fellows to the College

The below is from an ACTEC Press Release dated March 31, 2021:

The Board of Regents of the American College of Trust and Estate Counsel (ACTEC) convened during the College’s Virtual Annual Meeting to consider nominations for a new class of Fellows. The College is pleased to announce that 43 individuals were elected. The select group spans the US and includes seven international Fellows representing Buenos Aires, Argentina; Hamilton, Bermuda; London, England; Paris, France; Vaduz, Liechtenstein; Caracas, Venezuela; and Zurich, Switzerland; as well as two Academic Fellows.

To qualify for membership, a lawyer must have no fewer than ten years’ experience in the active practice of trust and estate law, as fiduciary counsel with a fiduciary services company, or a combination thereof, or be a full-time teacher of law at a duly accredited law school with a specialty of teaching T & E law and have at least ten years' cumulative experience as a lawyer in active private T & E practice or as a teacher of T & E law, or a combination thereof. Lawyers and law professors are elected to be Fellows based on their outstanding reputation, exceptional skill and substantial contributions to the field by lecturing, writing, teaching and participating in bar leadership or legislative activities. It is their intention to improve and reform probate, trust and tax laws, procedures and professional responsibility.

“I am pleased to congratulate and welcome our outstanding new class of ACTEC Fellows from around the world,” said ACTEC President Ann B. Burns. “I look forward to working with this expansive group of professionals whose exceptional abilities and commitment to the field of trusts and estates will help enhance and further key objectives of the College.” 

ACTEC New Fellows

·        Jerome Assouline of Sekri Valentin Zerrouk, Paris, France

·        Robert Barton, Esq. of Holland & Knight LLP, Los Angeles, CA

·        Alberto I. Benshimol Bello of D'Empaire, Caracas, Venezuela

·        Julie A. Berkowitz, Esq. of the Law Office of Julie Berkowitz, Saint Louis, MO

·        Darren  T. Case, Esq. of Tiffany & Bosco, P.A., Phoenix, AZ

·        Toby M. Eisenberg, Esq. of Lindquist Eisenberg LLP, Plano, TX

·        Josie M. Faix, Esq. of Balson Faix & McVey LLP, Centennial, CO

·        Matthew M. Farley, Esq. of Armstrong Bristow Farley & Schwarzschild PLC, Richmond, VA

·        John R. Fitzpatrick, Esq. of Frazer, Ryan, Goldberg & Arnold, L.L.P, Phoenix, AZ

·        Jessica Lynn Foss, Esq. of Fredrikson & Byron, P.A., Fargo, ND

·        Johannes Gasser of Gasser Partners Attorneys at Law, Vaduz, Liechtenstein

·        Jennifer DiVeterano Gayle, Esq. of Mannion Prior, LLP, King Of Prussia, PA

·        Elizabeth R. Glasgow, Esq. of McDermott Will & Emery LLP, Los Angeles, CA

·        Chasity Grice of Peppel, Grice & Palazzolo, P.C., Memphis, TN

·        Kristen Frances Hager, Esq. of McGuireWoods LLP, Richmond, VA

·        Loretta A. Ippolito, Esq. of Paul, Weiss, Rifkind, Wharton & Garrison, New York, NY

·        Emily B. Kile, Esq. of Kile & Kupiszerski Law Firm LLC, Scottsdale, AZ

·        Dennis I. Leonard, Esq. of Ramsbacher Prokey LLP, San Jose, CA

·        Renat V. Lumpau, Esq. of Choate, Hall & Stewart LLP, Boston, MA

·        Craig MacIntyre of Conyers Dill & Pearman, Hamilton, Bermuda

·        Nicolas Malumian of Malumian & Associates, Buenos Aires, Argentina

·        Steven Frank Mattoon, Esq. of Matzke, Mattoon, Martens & Stromen, L.L.C., Sidney, NE

·        Samantha Rayburn Moore, Esq. of Butler Snow LLP, Ridgeland, MS

·        Stephen W. Murphy, Esq. of McGuireWoods LLP, Charlottesville, VA

·        William G. Newsome III, Esq. of Newsome Law, P.A., Columbia, SC

·        J. Steve Nys, Esq. of Fryberger, Buchanan, Smith & Frederick, P.A., Duluth, MN

·        Maureen L. O'Leary, Esq. of O’Leary-Guth Law Office, S.C., Thiensville, WI

·        Pamela Epp Olsen, Esq. of Pamela Epp Olsen Law, PC, LLO, Scottsbluff, NE

·        Louisa M. Ritsick, Esq. of Bryant Ritsick Symons & Ratner LLC, Denver, CO

·        Jenna G. Rubin, Esq. of Gutter Chaves Josepher Rubin Forman Fleisher Miller P.A., Boca Raton, FL

·        Toni M. Sandin, Esq. of Sandin Law, Ltd., Fargo, ND

·        Victor J. Schultz, Esq. of Prairie Trust, Waukesha, WI

·        Lisa A. Shearman, Esq. of Hamburg, Rubin, Mullin, Maxwell & Lupin, P.C, Lansdale, PA

·        Alfred J. Stashis Jr., Esq. of Dunwody White & Landon, P.A., Naples, FL

·        David E. Stutzman, Esq. of Seward & Kissel LLP, New York, NY

·        Professor Phyllis Taite of Florida A&M University College of Law, Orlando, FL

·        Mary E. Vandenack, Esq. of Vandenack Weaver LLC, Omaha, NE

·        Christine S. Wakeman, Esq. of Winstead P.C., Dallas, TX

·        Emma-Jane Weider of Maurice Turnor Gardner LLP, London, England

·        Professor Reid Kress Weisbord of Rutgers Law School, Newark, NJ

·        Kinga Maria Weiss of Walder Wyss, Zurich, Switzerland

·        Edward V. Wilcenski, Esq. of Wilcenski & Pleat PLLC, Clifton Park, NY

·        Andrew Zabronsky, Esq. of Hartog I Baer I Hand, Orinda, CA

About the American College of Trust and Estate Counsel (ACTEC): Established in 1949, The American College of Trust and Estate Counsel (ACTEC) is a national, nonprofit association of approximately 2,500 lawyers and law professors from throughout the United States and abroad. ACTEC members (Fellows) are peer-elected on the basis of professional reputation and expertise in the preparation of wills and trusts, estate planning, probate, trust administration and related practice areas. The College’s mission includes the improvement and reform of probate, trust and tax laws and procedures and professional practice standards. ACTEC frequently offers technical comments with regard to legislation and regulations but does not take positions on matters of policy or political objectives.

March 31, 2021 in Appointments and Honors | Permalink | Comments (0)

VANESSA BRYANT PLEASE JUDGE, CANCEL MY MOM ... Her Claims For Lifetime Support Are Bogus

VanessaVanessa Bryant's mother, Sofia Laine, filed a lawsuit against Kobe's estate alleging that Kobe Bryant promised to take care of her financially for the rest of her life. 

Vanessa Bryant asked the judge to dismiss her mother's claim, alleging that her mother's claims are "bogus." 

Vanessa Bryant used previous documents to shed light on a legal fight her mother had with her ex-husband in 2004 and 2008 over spousal support. Sofia's ex-husband claimed that he should not have to pay her because Kobe and Vanessa were supporting here. Sofia rebutted by saying that Kobe and Vanessa had no obligation to support her and anything they provided for her was "simply out of the goodness of their hearts." 

Vanessa Bryant also claims that even if Kobe had made the oral promise to Sofia, its too vague to be enforced. 

Sofia has also claimed that Vanessa and Kobe violated California labor laws by not giving her "meal breaks, rest periods, and giving her minimum wage for babysitting services." Vanessa rebutted these claims by saying Sofia was never an employee but is instead a grandmother who helped Kobe and Vanessa by spending time with her grandchildren. 

Vanessa Bryant's legal team has also stated that Sofia did not file a creditor's claim within a year of Kobe's death so she cannot go after Kobe's estate. 

The judge has not made a ruling yet. 

See VANESSA BRYANT PLEASE JUDGE, CANCEL MY MOM ... Her Claims For Lifetime Support Are Bogus, TMZ, March 29, 2021. 

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

March 31, 2021 in Current Events, Estate Administration, Estate Planning - Generally, New Cases, Sports | Permalink | Comments (0)