Trusts

As we prepare to celebrate Valentine’s Day, let’s take a moment to ruminate on how judges through the ages have addressed love and affection. We’ll start with Justice Jackson of the US Supreme Court, who authored a dissenting opinion for a 1942 case involving two people who had left their homes and respective spouses and set up housekeeping as husband and wife. Jackson first lamented that the case involved three...

Millennials and Gen X, listen up. Estate planning is not merely for the elderly.  Covid has taught us that, if nothing else. Consider that one-fourth of the 800,000 Covid deaths have been people younger than 65. Many more young adults have had Covid, survived, and are now dealing with the long-term effects. There were 8.7 million diagnosed cases for adults aged 18 to 29, and over 12 million for adults aged...

This may come as a shock, but most of us have gotten gifting wrong for years.   The problem is that we associate gifts with traditional celebrations: birthdays, anniversaries, holidays such as Christmas. It is the event, not the recipient, that sends us frantically shopping. Without the event, we likely would not have given a gift to the recipient.     Put that way, traditional gifting sure seems backwards.   It is time to repackage the...

Dear New Widow(er): Your friends here at the federal government join me in sending condolences for your loss. We want you to know we are here for you.  To help get things started, we have structured a few special tax deadlines that you really do not want to miss. No wasted time grieving here! One deadline that may seem a bit silly, given that the estate tax exemption of $11.7 million, is...

Beware your financial institution. It can be the downfall of your estate plan. You and your financial institution have a contract. The terms of that contract can be found in your bank account signature card, beneficiary agreement or similar account agreement. You signed it when you opened your account. Financial Institution Restrictions Financial institutions can, through their contracts, impose restrictions on how you style your accounts and name beneficiaries. Those restrictions often...

A trust is simply a contract between a “trustee,” who manages the trust, and a “grantor,” who establishes the trust. It is set up for the benefit of the “beneficiaries.” The trust document sets out the terms.  A trust is often considered the foundation of estate planning. While a trust is frequently characterized as a method to avoid probate, it has many other uses. For example, it can be used...

Trusts can pop up in the darndest places. Take wills, for example. In one case, Sam, a lawyer, drafted a will for his long-time friend and client, Nancy, that stated she was leaving all her property to him “to be distributed in accordance with the specific instructions I have provided him.” The will did not contain the specific instructions. Nancy died, leaving no husband and no children. Her will was probated and...

A Trust is a legal chameleon. What is a Trust At its most basic, a trust is an agreement by a fiduciary (the trustee)  to hold property for the benefit of another.  A trust is not a separate legal entity. There are three players in a trust – the settlor (who establishes and sometimes funds the trust), the trustee (who administers the trust) and the beneficiary (who benefits from the trust). A trust...

If you are the grantor, beneficiary, creditor, trust protector, CPA, financial advisor, attorney or trustee of a trust, or if you just generally think trusts are a nifty idea and want to learn more, then you will find this of interest. The Rule Against Perpetuities for trusts in Texas is going on life support as of September 1, 2021 and Texas dynasty trusts are now a real thing. No fooling;...

Happy Father’s Day! Ah, but this is a legal column, so let us look at that greeting a bit more closely.  There are many types of fathers. There are biological fathers, legal fathers, intended fathers, step-fathers and adopted fathers. A man might be a father for purposes of family law but not a father for purposes of the probate law.    Fathers can be presumed, contractual, or acknowledged. They can be estopped into...

In the realm of estate planning, there can be a lot of confusion around terminology. Often people come into our offices asking for or about one type of legal document or another, and either they do not understand what they are asking for, or they don’t understand the interplay among various legal documents. In this article, we will address two terms which some people use interchangeably, but which are...

Revocable living trusts are often used as an estate planning tool. They are so common, in fact, that many people do not realize they come with special concerns. Below are a few of the issues that often arise. Bank Accounts Bank accounts that are transferred into a revocable living trust can easily exceed the standard maximum deposit insurance amount (SMDIA) insured by the Federal government. That insurance is intended to cover...