Take-Away: If an individual owns an interest in a cannabis-related business, special consideration needs to be given to holding that interest in a trust, and transfer of that interest by the trustee from the trust, so long as cannabis is treated as an illegal substance under federal law and such business is highly regulated and […]

Take-Away:  While charitable deductions that cannot be used in one year can be carried over for another 5 years, there is one ‘trap’ where that will not be the case. Background: The Tax Code permits a carryover of the income tax deduction with regard to excess charitable gifts. That carryover is up to the next […]

Take-Away: The IRS published today the applicable federal rates (AFRs) and the IRC 7520 rate for  transactions occurring in December, 2020. Short-term Rate (less than 3 years):                         0.15% Mid-term Rate (between 3 and 9 years):                 0.48% Long-term Rate (longer than 8 years, 11 months) 1.31% (up from this month’s 1.17%)  The IRC 7520 rate used […]

Take-Away: A no-contest, forfeiture, or in terrorem, clause in a Will or Trust will be enforced in Michigan, unless the challenger possesses probable cause to challenge the validity of the Will or Trust. As a broad generalization, courts are reluctant to enforce a no-contest clause. Background: A no-contest clause provides that any beneficiary who contests […]

Take-Away: While Michigan has two separate statutes that enable a trustee to decant trust assets to a second trust created by the trustee, not to be lost is that a trust instrument can include its own decanting authorization given to the trustee, without having to contend with some of the hurdles imposed by Michigan’s two […]

Take-Away: With many individuals losing their jobs due to COVID-19, adding to their personal problems is the impact of that loss of employment on any outstanding loans that they may have taken from their qualified retirement plan account . Their failure to repay the loan will result in a taxable deemed distribution. Background: As we […]

Take-Away: The State Bar’s Probate and Estate Planning Council is currently studying proposed legislation with regard to permitting silent trusts in Michigan. A trustee should think twice before accepting the appointment of a silent trust due to the increased risks associated with administering a silent trust. . Background: Some settlors want to restrict a beneficiary’s […]

Take-Away: If a settlor wishes to establish a silent trust it would be best to establish that trust in, and subject it to, the laws of Delaware. Background: While Michigan is currently taking a second look at the legal authorization to create a silent trust, which is inconsistent with the common law duty of a […]

Take-Away: As we approach the end of the calendar year, at a time when end-of-the-year gifts might play a more prominent role than in years past, a gift of a fractional interest in real estate with substantial valuation discounts should be considered by the donor. Background: As has been reported over the past 2 months […]

Take-Away: A Remainder Purchase Marital Trust (RPM Trust) is sometimes described as an alternative to a spousal lifetime access trust (SLAT) or a grantor retained annuity trust (GRAT.) Like a SLAT or a GRAT, an RPM Trust is a sophisticated estate planning technique that is intended to remove assets from the spouses’ taxable estates, with […]