Take-Away: Effective the first of this calendar year, the IRS  imposed new audit rules on partnerships and multimember LLCs. These new rules may leave a trustee vulnerable for claims for tax liabilities of others, or for a breach of trust with regard to an interest in a partnership or LLC owned by the trust. Background: […]

Take-Away: When the minor nears the age 21 years and is entitled to receive the balance of his/her Uniform Transfer to Minors Act (UTMA) account, the parents of the minor, or the UTMA custodian, can take a few steps to try to control the assets before the reach the minor’s hands, but none of these […]

Take-Away: An agent who acts under a durable power of attorney may be exposed to claims of self-dealing if the agent takes actions that benefit the agent or the agent’s family members. Less obvious is that the agent’s confidential relationship with their principal can expose the agent to claims of undue influence over his/her principal […]

Take-Away: While a federal gift tax return appears fairly simple in form to complete, the rules that must be followed to complete that Form 709 are far from simple. A complex rules follow which indicate the complexity associated with completing the ‘simple’ federal gift tax Form 709. Split-gifts:  Married taxpayers who are U.S. citizens or […]

Take-Away: The U.S. Supreme Court just upheld a state statute that retroactively revoked the life insurance beneficiary designation where the insured’s former spouse was the named primary beneficiary. The statute was challenged by a former spouse who claimed that the statute violated the Constitution’s Contracts Clause, which deprived her of her right to receive the […]

Take-Away:  One of the challenges in directing an IRA to be paid to an irrevocable trust on the IRA owner’s death is how to identify the oldest beneficiary of the trust whose life expectancy governs the required minimum distributions the trustee must take from the decedent’s IRA. Even more of a challenge is if there […]

Take-Away:  Sometimes how an heir receives his or her inheritance dictates if he or she will be able to keep that inheritance if creditors are circling. The Bankruptcy Code provide a ‘bright-line’ approach to what is considered property included in the heir’s bankruptcy estate. The ‘bright-line?’ Avoid passing the decedent’s assets to an heir by […]

Take-Away: Sometimes we forget why the use of a revocable grantor trust is a critical part of an estate plan. Several practical, financial and creditor advantages exist to the use of a revocable Trust over a Will went the transfer of wealth occurs on an individual’s death.   Background: A draft Will crossed my desk […]

Take-Away: As we counsel clients about estate planning over the next few years, we do so with the expectation that interest rates will continue to rise. Some conventional estate planning strategies like qualified personal residence trusts (QPRTs), grantor retained income trusts (GRITs) and charitable remainder annuity trusts (CRATs) perform well as interest rates continue to […]

Take-Away: While a trust should always contain a material purpose clause to guide the trustee, and possibly guide a probate judge as well, as to the settlor’s intent in establishing a trust, if the trust instrument confers discretion on the trustee with regard to distributions, the settlor should also supplement the trust instrument with non-binding […]