Take-Away: For Medicaid  planning purposes some states, but not Michigan, follow the ‘name on the check’ rule, that permits a shift of income from the institutionalized spouse to the community spouse without jeopardizing an institutionalized spouse’s Medicaid eligibility to protect the community spouse. Background: The name on the check rule is a common guideline used […]

Take-Away: In July the Michigan Court of Appeals published a decision that recognizes an electronic document as a valid will. In re Estate of Duane Francis Horton, Michigan Court of Appeals, No. 339737 (July 17, 2018.) A legitimate concern is that this court decision puts even more responsibility on the shoulders of a personal representative […]

Take-Away: Over the last couple of years, and especially after the 2017 Tax Cut and Jobs Act gave taxpayers a dramatic increase in their federal estate tax exemption, there has been a lot written about how to intentionally include the value of assets held in preexisting irrevocable trusts in the trust settlor’s taxable estate at […]

Take-Away:  A no-contest clause in a trust is valid in Michigan, unless the challenger possesses probable cause  to file the contest. Michigan’s statute refers to the enforcement of such a penalty clause if the contest is to the trust or instituting another proceeding relating to the trust. Only now are courts starting to grapple with […]

Take-Away:  Learning the SECURE Act’s new distribution rules, and the exceptions to those rules, will be a new challenge. The SECURE Act provides several new ‘rigid’ rules and effective dates with regard to distributions from inherited retirement accounts. Those new rules can lead to some pretty strange results. A few examples follow- Grandfathered Stretch Distribution […]

Take-Away: An individual who is disabled, as defined by the Social Security Administration, or who is certified as chronically ill, is defined under the SECURE Act as an eligible designated beneficiary who is entitled to use the life-expectancy distribution regime with regard to inherited retirement benefits. One issue associated with these two classifications is how […]

Take-Away: Earlier I addressed how a disabled beneficiary of an inherited IRA account is treated as an eligible designated beneficiary who is entitled to use stretch distributions over his/her life expectancy. However, the Tax Code’s definition of disability is very narrow, and thus hard to meet. A recent case that dealt with the disability waiver […]

Take-Away: The Michigan Trust Code imposes several distinct duties on a trustee to inform trust beneficiaries. Currently the State Bar’s Probate and Estate Planning Council is looking at possible changes to those duties, exploring the possible use of a silent or quiet trust in Michigan. Background: The Michigan Trust Code (MTC) adopted one of the […]

Take-Away: A minor child named as the beneficiary of their parent’s retirement account is classified as an eligible designated beneficiary under the SECURE Act. The distribution rule is straight forward if the minor is named directly as the beneficiary of their parent’s IRA. More than likely, however, the parent will direct their IRA be paid […]

Take-Away: Under the SECURE Act, a surviving spouse is treated as an eligible designated beneficiary who is entitled to continue to use the former stretch distribution rule over the surviving spouse’s life expectancy. When one spouse dies leaving their retirement assets to their surviving spouse, or to a trust for their spouse’s benefit, usually one […]