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Updates to Florida UTMA and Florida Health Care Surrogate Statutes

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Uniform Transfers to Minors Act

Florida’s Uniform Transfers to Minors Act (“UTMA”), found under Florida Statutes Chapter 710, provides a mechanism for the creation of custodial accounts for gifts, bequests or other transfers to minors, without requiring the presence of an appointed guardian for the minor. Previously, under Florida’s UTMA, minors were defined as persons under the age of 21. The new UTMA statute, effective July 1, 2015, permits custodianships to last until the age of 25. A custodianship under Florida law can be created if the transferor, the custodian or the minor resides in Florida or if the custodial property is situated in Florida.

Health Care Surrogates

A designation of a Health Care Surrogate is a written document appointing someone to make health care decisions for an individual (the “Principal”) or receive health information on such person’s behalf in

Estate Planning Tips for College-Bound Children

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Originally posted on August 18, 2011 here.

It’s back to school time, and if you have college-age children, you’re probably busy helping them get organized to leave home.  While most packing lists include extra-long twin sheets and expressly forbid hotplates, there’s something else your budding intellectual shouldn’t leave home without: basic financial and medical estate planning documents.  If your children are over 18, federal privacy laws protect their financial and medical information.  Three basic estate planning documents will authorize you to act on behalf of your child, in the event that your child cannot make such decisions for him- or herself.

A Durable Power of Attorney for financial purposes designates an attorney-in-fact to act on your child’s behalf in all financial, tax, legal, investment, and insurance matters if your child becomes incapacitated

Do You Know Which States are Trying to Tax Your Trust?

451594605In an environment in which states are continuously searching for methods of increasing tax revenues, a major consideration for any settlor, beneficiary or trustee of a trust should be where the trust might be subject to income tax. The days of a trust being taxed in the state where it has its “principal place of administration” are quickly fading, as we enter into a new era in which states are increasing attempting to tax trusts with minimal contacts to the jurisdiction.

Missouri Court Determines When Estate Beneficiary Has Standing to Raise Undue Influence Claims

With research and drafting assistance from Washington University extern, Kelsey Delong.

In Williams v. Hubbard, et. al., the Missouri Court of Appeals addressed the issue of whether a beneficiary of a decedent’s estate would be entitled to funds from the decedent’s account if the payable on death (“POD”) beneficiary or joint owner of the account was found to have procured the beneficiary or ownership interests through undue influence. In this case, the court found that the beneficiary could have rights to some of the decedent’s multiple accounts, but not all of them.

In this case, Betty Margaret Reynolds (“Betty”) hired Respondent Kenneth Nelson to draft several of her estate planning documents, including a beneficiary deed, a 2000 Will, and a 2006 Will. The beneficiary deed named Appellant Eric Williams as the sole beneficiary of certain real estate owned by Betty. The 2000 Will drafted named Norma Lamp and Erma

Missouri Court Of Appeals Holds That Attorney-In-Fact Violated Fiduciary Duty

With research and drafting assistance from Washington University School of Law student, Kelsey DeLong.

In Estate of Lambur, the Missouri Court of Appeals addressed the issue of whether an attorney-in-fact is permitted to gift the principal’s property to herself when the gift is not expressly authorized in the power of attorney.

In 2005, Verna Irene Lambur (“Irene”) executed a durable power of attorney naming her nephew’s wife, Anna Stidham (“Anna”), and Jackie Johnson (“Jackie”) as her attorneys-in-fact. The power of attorney granted Irene’s attorneys-in-fact the following power:

“To establish, change or revoke survivorship rights in property or accounts, beneficiary designations for life insurance, IRA and other contracts and plans, and registrations in beneficiary form; to establish ownership of property or accounts in my name with others in joint tenancy with rights of survivorship and to exercise any right I have in joint property; to exercise or decline to exercise

IRS Takes Restrictive Position on Ability of Trust to “Materially Participate” in Pass-Through Entities

Beginning this year, individuals, estates and trusts will be subject to a Medicare contribution tax equal to 3.8% of the trust’s undistributed net investment income for the tax year, complicating the administration of estates and trusts. (IRC § 1411) As a result of the enactment of the new tax, every trust that owns an interest in a trade or business must now determine whether or not the trust materially participates in that trade or business in order to determine whether the trust’s undistributed income may be subject to the tax.

Net investment income is income from passive activities. Whether an activity constitutes a passive activity is determined in accordance with IRC § 469, which sets forth the law with regard to passive activity losses and credits. A “passive activity” is a trade or business activity in which the taxpayer does not materially participate. A taxpayer is treated as

A Very Merry Un-Taxday To You

With research contributed by Melissa Fernley.

As the old saying goes, the two things you can’t avoid are death and taxes. But while the grim reaper may arrive unplanned, it’s generally understood in the U.S. that the taxman comes calling on April 15th – except when he doesn’t. This year, today, April 17th, is Tax Day. And last year, in 2011, it was April 18th. What causes this variation in the tax filing deadline? And why is Tax Day April 15th (ish) anyway? Read on for answers to all of your tax questions (that don’t actually relate to your taxes).

Florida’s New Power of Attorney Act

Florida’s new Power of Attorney Act contained in the Florida Statute, Chapter 709, went into effect October 1, 2011. The new statute will affect how attorneys draft, utilize, and enforce powers of attorney (“POA”). Some of the more significant provisions of this new legislation are discussed below.

What is a POA? A Power of Attorney is a writing in which an individual (the “principal”) grants authority to another individual (the “agent”) to act in place of the principal; each act performed by the agent pursuant to the Power of Attorney has the same effect and benefit to the principal and the principal’s successors in interest as if the principal had performed the act himself.

Why have a POA?

Having an executed Power of Attorney is important in situations where an accident or illness renders an individual incapable of making decisions for themselves. By having an attorney prepare a Power of

No Good Deed Goes Unpunished?

When Christian Lopez caught Derek Jeter’s historic 3,000th hit on July 9, he most likely thought that he was just being a nice guy by giving it back to the Yankee shortstop. In that moment, Lopez probably didn’t realize that his incredibly selfless gesture could lead to potentially negative tax consequences.

Did Lopez give the ball to Jeter as a gift? That could mean that Lopez made a taxable gift equal to the fair market value of the ball. How much is that ball actually worth? Fair market value is defined as the price a willing buyer would pay a willing seller for the ball. You can buy an official Rawlings MLB baseball on amazon.com for $17.30. Chump change. However, some people are estimating that Lopez could have sold Jeter’s ball for up to $250,000. Now we’re talking

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