In Virginia, most people’s estates are probated in the city or county in which they lived at the time of their death. For Virginia residents who pass away owning real estate outside of Virginia, probate matters can be significantly more involved.
If you’ve been appointed as a guardian or conservator for an incapacitated adult, you’ve petitioned the court and obtained an order in the incapacitated person’s home state. Should you and the incapacitated person move to another state, however, that guardianship order may not be recognized.
This is the unfortunate case of John Spottiswood and Nancy Miyasaki, a married couple seeking an abatement and refund of penalties they paid for late filing their return and late payment their 2012 income taxes. While this decision coming out of the U.S. District Court for the Northern District of California will make all taxpayers a little nervous, it should scare the bejeezus out of tax return preparers. It serves as an example of how liability for tax return preparation and filing in general, has subtly shifted from taxpayers to the preparers with the proliferation of electronic tax return filing.
From 1987 through 2003, the federal estate tax exemption amount was between $600,000 and $1,000,000. This prompted many people to create Irrevocable Trusts to hold life insurance, or other Irrevocable Trusts to hold appreciating assets. The purpose was to remove life insurance proceeds or to remove the appreciation of an asset (think Amazon or Alphabet stock) from one’s taxable estate.
Many business owners struggle with the dilemma of how to retain their key employees without deluding their stock ownership in the company. This is especially applicable for closely held business owners who want to retain key personnel not only during the term of their ownership, but possibly when the owner turns over control to the next generation.
When a person dies owning a 401(k) or an IRA, must these accounts be used to pay the decedent’s debts, or are they exempt from the claims of the decedent’s creditors? The short answer is: it depends.
Deciding what to do with your assets after you pass away can involve a series of difficult decisions. These decisions are made even more difficult when one of your loved ones struggles with addiction or mental health issues.
As discussed in previous posts, for the purposes of guardianship and conservatorship, an “incapacitated person” means an adult who has been found by a court to be incapable of receiving and evaluating information effectively or responding to people, events, or environments to such an extent that the individual lacks the capacity to (i) meet the essential requirements for his health, care, safety, or therapeutic needs without the assistance or protection of a guardian or (ii) manage property or financial affairs or provide for his support or for the support of his legal dependents without the assistance or protection of a conservator.
A number of surveys over the last few years report that between 55% and 70% of adults in the United States don’t have an estate plan or have a plan that is outdated. The reasons given for their failure to plan and/or update their estate planning documents are myriad, and include, 1) I don’t have the time, 2) my estate isn’t large enough to worry about, 3) planning is too expensive, 4) I don’t like to think about my death and, my favorite, 5) there’s no estate tax so I don’t need an estate plan. Brilliant.
Upon completing their estate planning, clients often ask how often they will need to update their Wills and other estate planning documents in the future. While there is no set amount of time that applies to every client’s personal situation, a good rule of thumb is to review one’s Will at least every two to three years to ensure the Will still reflects one’s wishes.