Dear Clients and Friends of Greenleaf Trust, Each month we send our newsletter titled “Perspectives” to our clients and friends of Greenleaf Trust. Almost always, the content is about the economy, financial markets, wealth management retirement and financial planning. Today it is important that we talk honestly about a national crisis that has plagued our […]

The coronavirus induced sell-off is reaching new depths today as investors continue to grapple with the rapid spread of the virus and uncertainty around a fiscal response to curb slower economic growth from the outbreak.  The S&P 500 officially entered bear market territory this morning with losses extending more than 25% from the late February […]

Happy Monday? Oil prices, already beleaguered by softening demand owing to the coronavirus, opened another 30% lower to $35/barrel after disintegration of the OPEC+ alliance triggered a full blown price war among the world’s biggest oil producers.  The oil price shock adds another facet of uncertainty during a period of instability for the global economy […]

On January 27, we published a note sharing our perspective on the coronavirus outbreak.  While our views are largely unchanged, we felt it was important to provide an update as the issue continues to evolve. Status of the Outbreak: The coronavirus (COVID-19) manifests as a pneumonia-like illness resistant to standard treatments, and is believed to […]

Concerns over the human and economic impact of the coronavirus outbreak in China have driven a financial market flight to safety in recent days.  The outbreak invites anxiety on the heels of a sustained rally in U.S. stocks that occurred despite looming issues including a presidential impeachment, ongoing global trade negotiations, and a flare up […]

What happened? The tone in global financial markets turned cautious this morning after a U.S. airstrike in Iraq ordered by President Trump killed one of Iran’s most powerful generals, fueling concern over escalating tensions.  According to the Defense Department, the U.S. military took “decisive defensive action” by killing General Qaseem Soleimani who was “actively developing […]

We have been focused on two primary drivers for US markets in 2019: trade negotiations and the Federal Reserve’s monetary policy decisions. On Wednesday, July 31st, the Federal Reserve cut interest rates by 0.25%. In his press conference, Fed Chair Jerome Powell noted trade policy’s impact on their decision to ease: “After simmering early in […]

Less than two weeks ago, investors were operating under the assumption that a U.S./China trade deal was all but certain.  Much has changed in a short period. Uncertainty has been reintroduced around when, or if, an agreement will materialize.  We continue to believe an eventual compromise is the most likely outcome, but for now, visibility […]

Considerable time these days is spent identifying ways to include the value of trust assets in the settlor’s gross estate in order to obtain an income tax basis adjustment to those assets. But the settlor or beneficiary’s death is a condition to this planning strategy. What if capital gain exclusion could be obtained while the […]

Disclaiming an interest in property has always been a way to add flexibility to an estate plan. By exercising of a timely qualified disclaimer, the disclaimant effectively moves assets to another individual, or to a trust, without incurring any gift tax. Consequently, disclaimer planning takes center-stage in many estate plans these days by spouses to […]

A couple of months ago I wrote about the possible use of spousal lifetime access trusts (SLATs) as a way for a married couple to exploit the recent $5 million increase in their respective federal gift tax exemption amount, while still retaining access to the cash flow generated by those transferred assets. Yet another technique […]

The 2017 Tax Cut and Jobs Act provides more incentives for individuals to gift assets either to their family members or to dynasty-type irrevocable trusts. The temporary increase in the applicable transfer tax exemption amount by $5.6 million per individual encourages the wealthy to consider making large gifts when no federal gift tax will be […]

The Tax Cut and Jobs Act (the 2017 Tax Act) provided several surprises, although I am not sure that it actually delivered that much simplification to a complex tax code as was promised. One big surprise was to make alimony or spousal support no longer tax deductible by the payer or taxable to the recipient. […]

Structuring an estate to obtain an income tax basis ‘step-up’ upon the death of a client continues to be a significant goal of many estate plans. New planning strategies try to exploit old estate tax rules to intentionally cause an asset to be included in a decedent’s taxable estate. This approach attempts to create rights […]

Modern trust statutes provide several ways in which to modify an irrevocable trust. For example, in Michigan an irrevocable trust can be decanted to move its assets to a new trust that is created by the trustee. MCL 700.7820a. Additionally, Michigan’s version of the Uniform Trust Code also offers several other procedures that can be […]

Much has been written lately about Michigan’s recent venture into the asset protection trust waters with its adoption of the Qualified Dispositions in Trust Act (the Act) effective in March of this year. The Act clearly indicates that a transfer of assets into the Qualified Dispositions Trust can only be set aside following by the […]

Decanting a trust is one way to eliminate or change provisions in an existing trust that are viewed as undesirable, or which are no longer workable due to changes in the law or the beneficiary’s circumstances. While there are some statutory limitations imposed on the trustee’s decanting power (e.g. the inability to decant-away the beneficiary’s […]

Why it is relevant: The draft persons of the proposed bill, which ultimately became the Michigan Qualified Dispositions in Trust Act [MCL 700.1041 et. seq.] thought that the Act could possibly result in a business boom for estate planning attorneys and trust companies in northern and western Michigan. Their reasoning was based on the notion […]

No one really seems to know these days what Michigan’s public policy is when it comes to prenuptial agreements or for that matter, postnuptial agreements. We are told that if a married couple enters into a postnuptial agreement while living together and with divorce not imminent, their agreement is against Michigan’s public policy and thus […]

With the uncertainty that surrounds the possibility of tax law changes by Congress this year, what advice can an advisor provide to their clients when it comes to estate planning? We are left wondering if there will be a federal estate tax, a federal generation skipping transfer tax, a federal gift tax, a ‘step-up’ (or […]

Just when you think you know what the law requires, along comes a court decision that throws water on that conventional thinking. Such was the situation last fall when the Michigan Court of Appeals in In re Estate of Sabry Mohamed Attia (October 10, 2016) surprised many estate planners with a decision that permits an […]

I had the dubious opportunity to serve both as a divorce attorney and an estate planning attorney for over 42 years. One lesson that I learned is that many divorce attorneys are not always cognizant of the income tax implications that arise in a divorce settlement. Many divorce attorneys even go so far as to […]

While most trusts are established to make distributions to either individuals who are the named trust beneficiaries or to a charity, a purpose trust normally exists to hold or to dispose of specific assets, meaning the trust exists to carry out a specific purpose rather than to provide a benefit to particular individuals. Purpose trusts […]