Take-Away: Grantor trusts are  popular estate planning tools these days. They are used to shift appreciating assets out of the grantor’s estate without incurring capital gains (and estate freeze)  and they require the grantor-settlor to continue to pay the income taxes on the trust’s income (and indirect form of a non-taxable gift to the trust […]

Take-Away: Clients should be encouraged to review, and update, their Durable Powers of Attorney for financial management purposes in light of the new federal gift tax exemption amounts and rights that may  they may hold under estate planning documents. Background: A durable power of attorney is a power of attorney where the principal designates another […]

Take-Away: This is a short follow-up to Carlene’s presentation yesterday morning at the CCT meeting. I want to stress that per capita by each generation is now the default rule of construction under the Michigan Estates and Protected Individuals Code (EPIC.) This was a fundamental change that occurred in the law in 2000 when Michigan […]

Take-Away: We know in the 2017 Tax Act that Backdoor Roth Conversions were legitimized by Congress. There was also a great sigh of relief when the Act failed to change required minimum distributions rules for inherited Roth IRAs.  There are a couple of more ‘tricks’ regarding Roth IRAs that you need to keep in mind […]

Take-Away: As we continue to help clients understand their estate plans, it is important to keep in mind that often a named beneficiary will disclaim, or sometimes release, an interest in an estate, trust, or beneficiary designation. Knowing the distinction between a disclaimer and release is critical when you factor the gift tax consequences into […]

Earlier this morning I provided a short update on 529 accounts and how the law was expanded to permit distributions from 529 accounts to pay some K through 12 expenses, not to exceed $10,000 in a year. That update triggered a couple of follow up questions, which I will try to address: Michigan Maximum Balance: […]

Take-Away: We already know that IRC 529 higher education accounts are a great way to save for the expense of a college education which, according to recent studies, exceed $34,000 a year for private schools and $10,000 a year at some public universities (non-residents pay about 3 times as much as residents at these public […]

Take-Away: In order to avoid the ‘shirtsleeves to shirtsleeves in three generations’ adage, we find ourselves spending more time with closely held business owners, not only in structuring their estates to avoid probate and federal estate taxes, but to also prepare their families for the responsibilities of managing that inter-generational transfer of wealth.  It seems […]

Take-Away: We normally think of self-settled asset protection trusts, like the Michigan Qualified Distributions in Trust Act, as the only way for a trust to protect assets that are transferred to it by a beneficiary. But we need to remember that there are other ways in which an irrevocable trust can be used to protect […]

Take-Away: Clients and their advisors need to spend more time looking closely at beneficiary designations, contingent beneficiary designations that are signed by clients and used to transfer wealth on the client’s death. Arguably more wealth might be transferred on an individual’s death via beneficiary designations or nontestamentary contractual arrangements than pursuant to their will and […]