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Estate Planning

Migrating the Domestic Asset Protection Trust Offshore

On October 2, 2009 Attorney David M. Grant presented an article, "Migrating the Domestic Asset Protection Trust Offshore," at the Annual Southpac Offshore Planning Institute in Las Vegas, Nevada.  The full article can be found here: Migrating the Domestic Trust Offshore. The article discusses techniques for trust migration or trust redomiciliation.  It also provides reasons for using a domestic asset protection trust prior to going offshore.  Moreover, the article provides the following chart explaining the specific rules relating to trust migration for particular offshore jurisdictions: Jurisdiction Governing Law Inbound Migration Outbound Migration Anguilla Anguilla Trusts Ordinance Allowed if recognized by previous governing law Allowed if recognized by the new governing law...

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WHY ESTATE PLANNING STILL MATTERS

For many years, estate tax planning was a fairly insignificant area of tax law, primarily because there were not that many people who had estates to tax. But with the advent in 1981 of what is known as the “Unlimited Marital Deduction”, and with the increase in the estate tax exemption from less than $100,000 in 1981 to $600,000 by 1987, coupled with a general increase in wealth, primarily resulting from booming stock markets and real estate markets in the 1980’s, 1990’s and well into the 2000’s, estate tax planning came to the forefront. At the same time, income tax...

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Estate Planning Attorneys Will Keep Busy After 2012 Election Results

Good morning America.  President Obama has won another four-year term as President of the United States! So what might that mean for the estate and gift tax laws?  While the President certainly surprised most everyone in December 2010 by temporarily raising the exemption equivalent of the unified credit to $5,000,000 and lowering the transfer tax rates to 35%, those hoping for the estate tax to disappear should probably not look for another similar surprise. The probability is now greater that we’ll have lower exemption amounts (as low as $1,000,000) and higher transfer tax rates (as high as 55%).  Let me be clear,...

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Top 10 Reasons Not To Do Estate Planning

Estate Planning is something everyone should implement yet so many do nothing until it is too late. So, we put together this Top 10 list as a parody to lighten the mood and hopefully open your eyes to the importance of proper estate planning. My spouse doesn’t need any direction or help in what to do or whom to call in the event of my death; if anything happens to me he/she will have no trouble figuring it out at that time. I plan on living forever, anyway. I don’t have any assets to speak of, just a house, a...

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Estate Planning Horror Stories: Lessons Learned

(Republished from Vegas PBS Source Magazine; October, 2103) For many, the thought of Halloween conjures up frightful images of haunted attractions, horror films, and gruesome costumes.  While these things might scare small children and pets, most folks would see them as entertaining, amusing, or even trivial.  For those seeking a truly horrifying experience for themselves and their loved ones, there’s nothing entertaining, amusing, or trivial about a poorly planned estate. As an estate planning and probate attorney I have witnessed some of the most horrifying of events.  I’ve seen accidental disinheritances, excessive taxes paid, costly probate litigation, the collapse of small businesses,...

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Obama’s New IDGT Proposal

By Attorney David M. Grant President Obama’s administration has recently proposed a change to the federal income and estate tax laws that would make the use of the Intentionally Defective Grantor Trust (“IDGT”) strategy essentially useless.  Important elements of the administration’s IDGT proposal can be found here. As a summary of the key features of the proposal, it would: Include the assets of  an IDGT in the gross estate of the grantor for estate tax purposes; Subject to gift tax any distribution from the IDGT to one or more beneficiaries during the grantor’s life; and Subject to gift tax the remaining IDGT...

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Top Ten Common Estate Mistakes

By Bob Morris and David Grant “Poor Man’s” estate plan.  Do-it-yourself estate plans can create more problems than they solve.  Many well-intentioned people will title assets jointly with a spouse, friend, or child, not understanding the significant legal ramifications.  Others will name a “Pay on Death” (“POD” or “TOD,” as they are sometimes called) beneficiary and consider their estate planning complete, while not planning for very real risks and contingencies. Failure to plan for significant others.  Domestic partners and others who cohabitate and live together do not share the same legal rights as married couples with regard to inheritances, health...

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Upside-Down Property at Death

Mark Dodds, Esq. discusses your estate planning process and options when dealing with real property that is upside down:

upside down houseIf the property is upside-down, it is best to leave the property out of a trust. Then, when the person with the trust dies, the trustee has no obligation as to the mortgage because the mortgage is not a debt of the trust as long as the trust is not a guarantor on the mortgage (and it is rare that the trust is a guarantor, but if it were, then the trustee would have to follow the procedure described below.)

So where the trust does not own the real estate and has no obligation on the mortgage, the trustee can do his normal notice to creditors, which gives creditors of the trust 90 days to file their claim, and if no claims are filed, or after any claims are filed and paid, then the trustee can distribute the trust estate. It is unlikely that the mortgage holder will pick up on the notice to creditors, and since the estate, which holds the upside down property, is a separate legal entity from the trust, the trustee has no duties concerning the mortgage, and can proceed to distribute the trust estate even though the home is upside down.