Monday, September 1, 2014
Steve R. Akers (Bessemer Trust), recently published an article entitled, ACTEC 2014 Summer Meeting Musings. Provided below is an excerpt from the introduction of the article.
Some of my observations from the 2014 ACTEC Summer Meeting Seminars in Dana Point, California on June 19-21, 2014 are summarized below. (At the request of ACTEC, the summary does not include any discussions at Committee meetings.) This summary does not contain all of the excellent information from the seminars, but merely selected issues from the seminars that I attended. (Recordings of all of the seminars are not yet available.) The summary is based on the presentations at the seminars, but the specific speakers making particular comments typically are not identified.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.
Sunday, August 31, 2014
Fifty-one year old singer-actress Vanessa William owes the federal government $369,249 on her 2011 earnings for which the IRS filed a federal tax lien.
Although this could be a misunderstanding between notices and her advisers, it is serious. Tax liens can be about income, property, or even estate taxes; and they are all about getting paid.
Despite their high earnings, celebrities often find themselves in this situation as their tax bills slip through the cracks. Lindsay Lohan’s missed bills lead to a $94,000 tax lien. IRS tax liens cover all your property even that acquired after the lien is imposed. The courts use it to establish priority in bankruptcy proceedings and real estate sales.
Liens last ten years, and generally release automatically if the IRS has not refilled them. Yet, it is better to get them removed sooner rather than later.
See Robert W. Wood, Vanessa Williams Slapped With Six Figure Tax Lien, Forbes, Aug. 29, 2014.
Jeffrey A. Cooper (Quinnipac University School of Law) and John R. Ivimey (Reid and Riege, P.C.) recently published an article entitled, 2013 Developments in Connecticut Estate and Probate Law, 88 Connecticut Bar Journal (2014). Provided below is the abstract from SSRN:
This Article provides a summary of recent developments impacting Connecticut estate planning and probate practice. Part I discusses 2013 legislative developments. Part II surveys selected 2013 case law relevant to the field.
As I have previously discussed, newly enacted Wisconsin Trust Code created changes in the state’s default rules for trusts that those with Wisconsin trusts should be aware of. Here are 10 considerations to keep in mind regarding the new code:
- The changes do not invalidate existing trust, but do apply to them.
- With some exceptions, most of the changes codify previous law for Wisconsin trusts.
- The WTC is based on the Uniform Trust Code with some state specific modifications.
- The WTC added flexibility for changing circumstances, and court appearances can now be avoided through a nonjudicial settlement agreement.
- The Code lists out duties and responsibilities of trustees and rights of beneficiaries.
- Special situations can be handled with more flexibility through a Directing Party in a Directed Trust.
- There is no change to the prudent investor rule.
- Trustees can now give third parties a certification of trust rather than the trust document, to maintain privacy of the trust terms.
- Trust Protectors may be appointed and may intervene in trustee and beneficiary disputes.
- The underlying purposes of using a trust have not changed
See John A. Herbers, Ten Things You Should Know About Wisconsin’s New Trust Code, Mondaq, Aug. 28, 2014.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.
The American Institute of Certified Public Accountants (AICPA) has published the latest version of their Statement on Standards in Personal Financial Planning Services. Provided below is a description of this guide from AICPA.
The AICPA’s Statement on Standards in Personal Financial Planning Services (SSPFPS No. 1), was issued to provide authoritative guidance and establish enforceable standards for members practicing in PFP. SSPFPS No. 1 was issued in January 2014 and is effective beginning July 1, 2014.
CPAs are licensed and regulated by their state boards of accountancy. Additionally, all AICPA members are required to follow a rigorous Code of Professional Conduct which requires that they act with integrity, objectivity, due care, competence, fully disclose any conflicts of interest (and obtain client consent if a conflict exists), maintain client confidentiality, disclose to the client any commission or referral fees, and serve the public interest when providing financial services. The vast majority of state boards of accountancy have adopted the AICPA Code of Professional Conduct within their state accountancy laws or have created their own.
Over the past three decades, a growing number of CPAs have expanded into providing personal financial planning services to individuals and families. The Compliance Toolkit was designed to provide non-authoritative guidance via checklists, engagement letters, and more to aid in compliance with SSPFPS No.1. For an overview of the challenges facing practitioners and the tools available to provide CPAs with guidance in determining whether SSPFPS No. 1 compliance is required, listen to this podcast on Understanding and Applying the Statement on Standards in PFP Services.
Saturday, August 30, 2014
A recent case from the Supreme of Mississippi held that forfeiture provisions in wills in Mississippi are enforceable unless the will contest has been founded upon probable cause and made in good faith.
This decision comes after siblings Bronwyn Benoist Parker and William Benoist litigated the will of their father, who granted significantly more property to William and less to Bronwyn than a previous will executed in 1998. Bronwyn alleged William had unduly influenced their father, who was suffering from dementia and drug addiction, into creating a new will, which included a forefeiture clause that revoked benefits to any named beneficiary who contested the will.
The Supreme Court of Mississippi held that Bronwyn had sufficiently shown that their suit was brought in good faith and founded upon probable cause. Thus, the Court reversed the decision of the Chancery Court, allowing Bronwyn to inherit in accordance with her father’s 2010 will. Parker v. Benoist, 2014 WL 4243763 (Miss.)
Special thanks to Howard M. Zaritsky for bringing this case to my attention.
I recently published an article entitled, A Guide to Fiduciary Selection, Estate Planning Developments for Texas Professionals (July 2014). Provided below is the abstract from SSRN:
Your clients must exercise great care in selecting fiduciaries such as executors, trustees, and agents. These decisions may affect the client and the client’s family members for many years. Decisions regarding the appropriate persons to select are, naturally, for your clients to make. However, you have a duty to explain to your clients the factors they should consider before making designations in wills, trusts and powers of attorney. This article focuses on these considerations.
The article begins with a discussion of legal criteria based on the law of Texas.
The remainder of the article has general application and discusses the factors from a practical standpoint which a client should consider as well as the pros and cons of using a corporate fiduciary and of appointing co-fiduciaries.
The third edition of the Tax Management Portfolio, Estate Planning, has been published by William P. Streng, Esq. (Vinson & Elkins Professor of Law, University of Houston Law Center). This Portfolio provides helpful guidance for estate planning professionals. Provided below is a description of the Portfolio from Bloomberg BNA.
Estate Planning is designed as an authoritative and practical working tool for attorneys, accountants, and others involved in estate planning practice. The basic estate, gift, and trust planning concepts are presented in a descriptive and conveniently accessible form. Written by William P. Streng, Esq., Vinson & Elkins Professor of Law, University of Houston Law Center, and Consultant, Bracewell & Giuliani LLP, this Portfolio analyzes the development of an estate planning strategy; fundamentals of the federal transfer tax system and related federal income tax rules; lifetime donative asset transfers; gratuitous property transfers at death; generation-skipping transfers; special property transfer planning considerations (e.g., community property, life insurance, charitable transfers, closely held corporations); and post-mortem planning.
The ABA Section of Taxation is offering the 2014 Joint Fall CLE Meeting, September 18-20, 2014, at the Sheraton Denver Downtown Hotel in Denver, Colorado. Registration and fees are due by September 11, 2014. Here is why you should attend:
Join us and take advantage of the opportunity to meet with the country’s leading attorneys and government officials to discuss the latest federal tax policies, initiatives, regulations, legislative forecasts and planning ideas. In addition, you will have the opportunity to earn valuable CLE and ethics credits and network with Tax Section and Trust and Estate Division members and government guests. The Sheraton Downtown will serve as the host hotel.
Friday, August 29, 2014
A recent case decided by the Georgia Court of Appeals serves as an important reminder that probate court litigation differs procedurally from other types of litigation. Thus, when confronted with a will contest or other probate proceeding, it is best to consult with someone who specializes in that type of fiduciary litigation.
In In re Estate of Loyd, an heir of Virginia Childs Loyd, Jack attempted to object to a petition to probate the will on grounds of undue influence. The trial court dismissed Jack’s caveat as untimely and the appellate court subsequently agreed.
After the petition to probate the will was filed, the probate court ordered heirs to file any objections to the petition within 13 days. The executor sought to dismiss Jack’s caveat as untimely and it was dismissed because Jack missed the deadline.
Although this was a short amount of time to answer, the court was persuaded by Jack’s argument that he was away from his residence and had no actual knowledge of the petition. He was therefore barred from challenging the will.
See Luke Lantta, In Georgia, The Time to File A Caveat May Be Short And Unforgiving, Brian Cave Litigation, Aug. 27, 2014.