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 and is no longer able to make decisions for him- or herself relating to those matters. (more…)
In our previous posts, Estate Planning for Digital Assets and Bitcoins and other Hidden Assets, we discussed how to protect online assets with a digital estate plan. Administering an estate with digital assets such as e-mail, online accounts, social media accounts, and online photo albums is an ever-growing issue among estate planners. As the digital age continues to grow, a client’s online presence has become another asset of value, but how such assets pass remains elusive to many. Although digital assets are a form of personal property, ownership rights and privacy controls are governed by a myriad of federal laws, state laws, privacy laws, copyright laws and intellectual property laws. (more…)
More than a month after his death at age 82, Casey Kasem’s body still has not been buried and now is missing from the Washington state funeral home where it was being held, according to a recent statement from the publicist for his daughter, Kerri Kasem.
Kasem’s body disappeared around the same time that Kerri Kasem was granted a temporary restraining order she sought to prevent Casey Kasem’s second wife (and the step mother of three of his four children, including Kerri), Jean Kasem, from cremating Casey’s remains or removing them from cold storage. Kerri was seeking a court order allowing Kerri to obtain an autopsy of her father’s body. Kerri has stated that in light of threats by Jean to sue Kerri for elder abuse and wrongful death she is concerned about how the results of any autopsy that Jean may have commissioned might be used.
While constant attention is being given to Hillary Clinton’s potential decision to run for the presidency in 2016 and the release of her latest book, Hard Choices, last month, news sources recently reported that she and former President Bill Clinton have taken advantage of several of the estate planning techniques recommended by trusts and estates attorneys for high net worth individuals.
This is interesting, in part, because the Clintons support the estate tax and have not been in support of its repeal.
According to reported sources, each of the Clintons created a qualified personal residence trust and each contributed his or her 50% ownership interest in their Chappaqua, New York house to his or her respective trust. A qualified personal residence trust, commonly called by its acronym QPRT, is an IRS sanctioned estate planning technique. The creator of the trust places a residence or interest in a residence in the trust, retains the right to live in the trust for a term of years, and after the term the trust asset or the residence passes to a beneficiary.
The Internal Revenue Code has special rules which help calculate the value of the “gift” made by the creator to the QPRT. The gift portion, which could offset some of the $5,340,000 exemption allotted to individuals in 2014 is not the entire value of the residence, but the value of the residence when transferred reduced by the value of the retained use by the creator for the trust term.
By having each of the Clintons create a separate QPRT with only a 50% interest in the residence, the value of such interest may also be eligible for a discount for owning less than a majority interest.
In order for a QPRT to work, the creator of the trust must outlive the trust term. But for a relatively healthy individual, it is quite likely for this to happen.
POLST, or Physician Orders for Life-Sustaining Treatment, is an approach to end-of-life care that encourages discussions between patients and their health care providers. The goal of POLST is to enable patients to choose the treatment they want or do not want, and to ensure that those preferences are honored. (more…)
In 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. (more…)
It’s June. Wedding season is upon us. It is a good time to think about prenuptial agreements. If you are engaged to be married, should you have a prenuptial agreement? At the minimum, you should at least consider the implications of marriage with or without such an agreement. (more…)
In 2012, the Fifth Circuit ruled in In re Chilton that inherited IRAs constituted retirement funds within the “plain meaning” of §522 of the Bankruptcy Code and were thus exempt from the bankruptcy estate, under § 522(d)(12) (the federal exemptions). See our prior discussion of this case here. (more…)
With research and drafting assistance provided by our extern from Washington University School of Law, Rachael Lynch.
Now that we’ve scared you with the potentially high taxes for self-dealing in private foundations, what is self dealing?
Self dealing includes any of the following transactions: