Divorce, Taxes and Trusts - The Perfect Storm

ACTEC Fellow Justin T. Miller dives into a tough combination of legal issues that many practitioners would not even consider.  The transcript and the podcast can be accessed through the link below: 

https://actecfoundation.org/podcasts/tax-cut-jobs-act-divorce/

Are you Prepared?

It may be November, but Hurricane Season is not over.  It ends November 30^th.  While the odds of a hurricane are lower this time of year, it’s always a good idea to be prepared.  Don’t wait until June 1^st to think about things that you need in the event of a hurricane:

• Review and update all of your estate planning documents, such as wills, powers of attorney, health care directives, and trusts. Keep them in a secure place, and be ready to take them with you if you had to evacuate on short notice.

• Keep your insurance coverage up to date.  Talk to your insurance advisor about cover for wind, flood, fire, and liability coverage.

• Think about your family’s needs if a disaster prevented you from working or resulted in long-term medical care.  Health insurance, long-term care coverage and life insurance can mean the difference between struggling to get by and having the resources to meet life’s unexpected changes.

New Guidance on the Impact of the 2017 Tax Act on Excess Deductions on Form 1041

After the 2017 Tax Act, there was confusion about the availability of "excess deductions" on Form 1041.  In the past, trustees and personal representatives could pass unused deductions on the final return (Form 1041) for the trust estate to the trust and estate beneficiaries.  This would be useful when the expenses (fiduciary, legal and accounting fees) exceeded the income for the tax year. The beneficiaries, if they itemized deductions on their personal returns could use their share of the excess deductions on their personal returns.  That seems fair, right?  In the linked commentator, respected national expert, Ron Aucutt, commented on the latest from the IRS.  It looks like recent guidance from the IRS has solved the problem. This still requires careful coordination by the trustee or personal representative of an estate, the attorney, and the accountant preparing Form 1041 for the estate and/or trust.  Here's the link to Ron's article.

Ron Aucutt - A Decade of Disrupted Tax Guidance

Homestead Waivers - When, Why, and How do they Work?

I serve on a committee within the RPPTL Section of the Florida Bar which deals with homestead issues.  Effective July 1, 2018, there is a new option for Florida estate planning attorneys when dealing with the complex benefits and restrictions for Florida Homestead owned by a married person. I serve on the committee with Jeff Baskies.  We teamed up to write an Article in the Florida Bar Journal to provide some insight into this new tool, including when to use it, why it is helpful, and how it is implemented.  Like so many features of a Florida estate plan, the new tool requires careful consideration before implementation.

https://www.floridabar.org/the-florida-bar-journal/homestead-planning-under-floridas-new-safe-harbor-statute/

Electronic Notarization and Electronic Wills come to Florida

In a recent article Florida Bar Journal by Sarah S. Butters and Jenna G. Rubin, the authors discuss the recent Florida legislation that authorizes online notarization and electronic wills. The Florida legislature attempted to create a balance between the convenience of online transactions and the safeguards necessary to ensure the validity of online notarization and the protection of vulnerable adults who may choose to conduct their planning through the use of electronic wills.  The legislation includes procedures to verify the identity of the person signing the online document. Florida notaries will be required to follow new procedures, utilize authorized technology and comply with education requirements.  The portion of the law relating to online notarization takes effect January 1, 2020, while the portion covering electronic wills takes effect on July 1, 2020.  As the linked article points out, Florida adopted the Uniform Electronic Transaction Act in 2000 and the Uniform Real Property Electronic Recording Act in 2007. 

https://www.floridabar.org/the-florida-bar-journal/danger-will-robinson-the-new-frontier-of-remote-online-notarization-and-electronic-wills/

Donor Advised Funds - A Great Planning Tool for the Philanthropic

Donor advised funds are a great option for estate planners to discuss with their clients. Professor Beyer's blog includes a link to a helpful article on donor advised funds which discusses the advantages this planning tool. Community foundations, like the Manatee Community Foundation in my home town, can help establish a donor advised fund, offering a good option for charitably-inclined clients who don't have the level of wealth to support a private foundation.

Wills, Trusts & Estates Prof Blog

lawprofessors.typepad.com

The importance of title to homestead property "vesting" at the instant of the owner's death.

Decisions involving Florida's homestead protections continue to show the need for careful analysis of the probate issues when a Florida resident dies owning a primary residence. The protections in the Florida Constitution have protected families since at least 1868, but continue to perplex planners and probate attorneys. In a recent case, the parties signed consents for an order involving a homestead residence. The order was not consistent with the deceased owner's Last Will and Testament. The appeals court reminded us about one of the cardinal rules for homestead issues in probate proceedings: Title vests at the moment of death; the will (or the laws of intestacy) controls the transfer of ownership at death and an incorrect homestead ruling by the court does not change the vesting of title. Without an proper agreement among heirs altering the disposition in the will, consenting to a petition in a probate proceeding does not alter the ownership interests of the heirs that vested at the instant of the owner's death. The decision in Mullins v. Mullins can be found here: https://www.5dca.org/content/download/526765/5852394/file/181672_1260_06072019_08253237_i.pdf