Portability re estate taxes, deductibility of assisted living expenses, and documentation requirement for charitable deductions

May 8, 2018 Posted by frank

As part of the process of updating the content on the website, we have updated some of the information on the website on: Portability re estate taxes, deductibility of assisted living expenses, and documentation requirement for charitable deductions.  This is a continuing project to bring new and fresh content to the website for the benefit of clients.

Updates to website

April 30, 2018 Posted by frank

We are in the process of updating the website, and putting material and posts on the website more frequently.  … enjoy ….  !!!!

Debts to now live on after death ?

November 15, 2013 Posted by frank

There is a move afoot in Florida to cause debts to live on after someone dies.  The authors of the recent proposal would make debts into guided missiles that would have a life of their own, and act sort of like a guided missile to chase after family members or loved ones if the debt wasn’t paid off in probate.  You can tell by my comments that I strongly oppose the proposal.

Actually, the proposal does address a growing problem where property can pass outside probate and sometimes in Florida avoid the decedent’s creditors.  If the proposal were to be altered to more narrowly define what is a testamentary disposition, and most importantly to involve such assets in the estate, then the proposal might be to some degree sensible.  However, the proposal as drafted would only apply to creditors, and then only in estates without enough assets to pay all creditors.  The current proposal ought to be called the “Windfall to Capital One,” because only creditors are involved, not beneficiaries who are harmed.  Further, it is surely a windfall, not just a protection to Capitol One (and other credit card companies), see the next paragraph.

A credit card company has a credit ap that lists whether assets are joint are not.  The credit card company prices credit based upon the credit ap, so Capital One would charge higher credit rates for someone who has accounts in a joint format, for if that person dies the joint assets aren’t in the estate to pay for the debt.  That is current law.  So Capitol One charges more for the credit, and then lo and behold in the estate Capitol One can use the new guided missile to chase family members on the joint account, despite the pricing having been made based upon such joint assets not being available at death.

Another problem with the legislation is that it may drive some clients to use banks outside Florida.  There is not doubt that jurisdiction over out of state persons over such assets is dubious, and even were that not true, it is hard to collect out of state.  Florida beneficiaries and Florida joint account holders are going to bear the brunt of the new law.  AND elderly persons contemplating this new terrible law will likely want to consider opening their bank accounts outside Florida.  There are many snow birds in Florida that do indeed have the flexibility to do that; although some retirees based solely in Florida may find it harder to do.  The Florida banks are just plain dumb to not lobby against this proposal; it is going to in the long run hurt their business.

It is possible that this proposal may jeopardize our green card service (this is a technical legal term, and probate practitioners know what I am talking about).  Probate is currently in rem, and the Capital One Windfall very certainly reaches out of state assets that aren’t in rem.  There is the very great potential that the proposal has many negative consequences that are not even imagined as of yet.  The authors of the proposal falsely claim that they “aren’t even changing the law, they are just clarifying it.”  As a result, they just haven’t looked at or appreciated the problems that would be created.  For example the probate statutes have a clear provision that probate is in rem; but they don’t amend that statute.  So the new proposal conflicts with statutes already on the books.  Ditto with respect to banking statutes.  Banking statutes say that accounts go free from all claims to the joint owner (such joint accounts can be challenged on undue influence and a number of other grounds); the new proposal would conflict with that.  By not seeing the conflict and not recommending changes to conflicting statutes the authors of the proposal are hiding the full impact of what they are doing.  If banks realized that their banking statutes would be amended to say that such accounts to not go free of all claims, it would give the banks something to think about when some other states do have similar banking statutes to the current Florida version.  It is wrong to hide the full impact of the proposed change in the hope that nobody realizes what you really are doing.

In addition, the legislation would destroy the family allowance and harm families.  There are many further negative consequences from this legislation that there isn’t time to cover here, I have only been able to mention the tip of the iceberg.  Hopefully, the legislation either won’t pass, or will be converted to something more sensible before it passes.


Article on claims in probate

November 15, 2013 Posted by frank

I recently authored an article on the timeliness of probate claims.  Should anyone have a desire to get a copy of the article, please let me know, you can fill out a contact form to do so if you wish.  Actually, to cover probate claims I would need a four part article, in which the timeliness portion that I just authored would be one of the four parts.  Maybe I will get the time to author 3 more parts in the future.

Effect of 2012 Election Results on Estate Planning

November 8, 2012 Posted by frank

The 2012 election is now over.  However, with divided government, the greatest likely result is continuing the estate tax free amount in the $5 to $3 million range.  It is true that currently on the law books there is a “fiscal cliff” with the estate tax free amount being reduced to $1 million in Jan 2013.  The strong likelihood is that the 2013 tax free amount will not be $1 million, but will instead be continued somewhere in the $3 to $5 million range.  This result could occur by passage of budget and/or tax legislation in the lame duck session later in 2012, or could be passed early in 2013 and made retroactive to Jan 2013.  Naturally, the $3 to $5 million predicted level is not a certainty until Congress actually acts to make the change.  However, Congress not acting this year (if they don’t) in the lame duck doesn’t mean anything; it is just as possible that the issue is addressed early next year.

Anyone wanting more information on estate planning and estate taxes in this environment should contact the law firm and ask for a copy of the long article “The New Normal.”  Before the election, occasionally I heard comments on both ends of the spectrum:  those who thought that the estate tax would be entirely eliminated by Congress, and those that worried that the estate tax free level might end up reverting to $1 million (after all that is the current law, until Congress passes some law to continue the current $5.12 million tax free level, or change it to some new amount).  And there were also clients that postponed estate planning, “waiting to see the outcome of the election.”  These considerations can now be put aside, and estate tax planning can move forward, using the “The New Normal” planning ideas.  The problem with waiting for the outcome of an election is that in another 2 and 4 years there is yet another election, and waiting for elections is a prescription for procrastination, for putting off needed planning.  Using “New Normal” ideas in estate tax planning, it is often advisable to implement estate plans that are flexible and that can adjust to new tax free tax amounts.  Please ask for a copy of the “The New Normal” long article for more information.

Charles review

September 26, 2012 Posted by frank

Charles took a quick look at the website and had a lot of good suggestions.

lot of content added

September 23, 2012 Posted by frank

A Lot of Content Added:

about half of the menu items have some content added.  That is substantial progress, but there is still a lot to do.  The website is still in the beginning stage.  Websites are visual mediums, but no pictures or visual added yet, except for photo.  sigh.  rome was not built in a day.




September 12, 2012 Posted by frank

Long journey begins with ……


Chinese Proverb