San Antonio, TX Estate Planning

Dispute over Ernie Banks’ Will

A dispute between the family of Ernie Banks and the woman who cared for him during his final years intensified Monday with his twin sons asserting that the caretaker coerced the Chicago Cubs baseball great into signing a new will giving her all his assets.

Ernie Banks, a.k.a. “Mr. Cub”, suffered a protracted illness before his death. During that time he was cared for by a friend, Regina Rice. Initially, Banks' family praised Rice and thanked her for looking after the baseball player in his last months. However, it did not take very long after the funeral for the family and Rice to get involved in two disputes.

First, Banks' widow went to court to stop Rice from having Banks' remains cremated. For now that might be a moot point as no one claims to know where Banks' body is currently located.

The second dispute centers on some estate planning documents Rice allegedly had Banks sign last October. As well as making Rice his power of attorney at that time, Banks also signed a new will to leave his entire estate to Rice. His wife and children were specifically cut out of any inheritance with the only reason given that they would know why.

Banks' sons, however, through their attorney claim not to know “why” and claim that Rice coerced Banks into signing the will when he was too sick to do so.

ESPN Chicago reported the story in a recent article titled "Suitability of Banks' caretaker faulted."

This case is still in its early stages. Accordingly, it is too soon to speculate how it might turn out.

Unfortunately, this is not an unusual story. Anytime an elderly, ill person rewrites a will to exclude family, the will is likely to be challenged.

To avoid missteps, especially when it comes to changing your estate plan, be sure to contact us for guidance on how you can avoid the courthouse front door.

Reference: ESPN Chicago (February 16, 2015) "Suitability of Banks' caretaker faulted."

Business Succession Dos & Don’ts from Sports Teams

While some might think family-owned sports teams are more plagued than Boston was by the 86-year “Curse of the Bambino,” I encourage you to look past curses to investigate causes. Identify potential estate and financial planning challenges your business might face, and deal with them. You’ll have better odds your family ends up on the winning side.

What can we learn from sports teams when it comes to passing on the family business? As it turns out, there are several good and bad examples of business succession in the sports world.

Recently, we have seen the forced sale of the Los Angeles Clippers because the owner's racist rant came to light. The Los Angeles Dodgers were recently sold in part because of the bitter and protracted divorce of its owners. Now, the owner of the New Orleans Saints is in a competency dispute with his family that could force the sale of the team.

In recent memory, both the Chicago Cubs and Miami Dolphins have been sold because the owner passed away without properly planning for how estate taxes would be paid.

Forbes has more on these situations in an article titled "Another Family Sports Team Failure, Another Lesson Learned."

The article also includes lessons to be learned from sports teams for other family businesses, which include:

• Poor planning outside of the business can cause the business to fail. This is especially true if the failure to plan for estate taxes causes the sale of the business.
• Family businesses can thrive with good planning. Both the New York Yankees and Pittsburgh Steelers have recently survived as family owned businesses after the owner passed away.
• No matter how much planning you do, bad things can still happen. The key thing is to plan well enough that the damage from any issues is contained.

Without question, one of the wisest moves you can make is to work with an experienced estate planning attorney. He or she has “been there and done that,” when it comes to the successful transfer of the business and preservation of family relationships in the process.

We have the expert knowledge and experience to guide you in formulating a solid plan for protecting your business through diligent planning. Read more about protecting your business here.

Reference: Forbes (February 16, 2015) "Another Family Sports Team Failure, Another Lesson Learned."

Leaving a Legacy through Private Foundations

 
So you’ve got a private foundation. Have you thought about who would run it after your death? Peter Karoff, founder of The Philanthropic Initiative, an advisory arm of the Boston Foundation, has some advice for donors and heirs: start planning.

For those who want to make charitable giving a part of their estate plans, private foundations provide a way to make that giving last. With private foundations wealthy families and individuals can create a fund of money that can be invested with the proceeds going to good causes for generations.

When the founder passes away, however, many private foundations have floundered with the successors unable to maintain them.

Recently, Forbes published some tips on making sure that does not happen to your foundation in an article titled "Do's And Don'ts of Passing Down A Private Foundation."

The list includes:

• Write a mission statement - With a mission statement, successors have a document that tells them what the foundation is supposed to do. Consequently, the statement can be referenced should there ever be any questions about the foundation’s objectives.
• Pay attention to family dynamics - Not every family member will be interested in participating in the foundation.
• Turn to experts - If you need help, seek out someone with expertise.
• Make connections - Network with other philanthropists.
• Plan for successions - Do not just name a board. Also name who will succeed those board members.

Family foundations can be an excellent way to continue your charitable legacy long after you are gone. There are other alternatives, however, that may be more appropriate for your unique circumstances. For example, donor-advised funds are less expensive to create, enjoy reduced scrutiny from the IRS and may provide greater tax deductions for the donors.

In the end, turning to “experts” is probably the best advice from this article. Accordingly, contact us to receive experienced legal advice as we help you navigate the rather complex waters.

Reference: Forbes (February 11, 2015) "Do's And Don'ts of Passing Down A Private Foundation."

Which Trust Is Best for You?

Trusts are a legal entity managed by a trustee for the benefit of others. Beyond that, however, trusts can get murky as there are many different types of trusts that are sometimes confusing to non-experts. Which one is the best option for you?

To help people overcome trust confusion, the Wills, Trusts & Estates Prof Blog recently published a short list of different types of trusts in an article titled "Choosing A Trust."

The list includes:

• Credit Shelter Trust - With this trust a spouse can leave everything to a surviving spouse in a will, but direct that everything be placed into the trust while maintaining the estate tax benefits.
• Clayton QTIP Trust - Similar to the more well-known QTIP trust, but if a QTIP election is not made, it acts like a credit shelter trust.
• Irrevocable Life Insurance Trust - These trusts are created to be the beneficiary of life insurance policies, which keeps the payout from those policies outside of the estate for tax purposes.
• Charitable Remainder Trusts - Directs that assets be paid to the beneficiaries for life with anything left over distributed to charity.

If you have questions about these or other types of trusts, call us today at 210-651-3851 or request a consultation with one of our experienced estate planning attorneys. We can help you select the type of trust that is best for your unique circumstances.

Reference: Wills, Trusts & Estates Prof Blog (February 13, 2015) "Choosing A Trust."

What Widows Need to Know about Estate Planning

The loss of a spouse creates different considerations for women than men as women are more likely to face financial challenges, according to a recent study. Here are some tips for addressing planning issues with recent widows.

Although both widows and widowers face estate planning challenges after a spouse passes away, studies show that single women are more likely to have financial difficulties than single men. This means that a widow's estate plan generally needs to be more flexible than a man's just in case the widow does experience financial issues in the future.

While estate planning for widows is often difficult, it is not impossible.

Recently, the Wills, Trusts & Estates Prof Blog published a list of planning tips for widows in an article titled "Planning Tips For Widows."

The list includes:

• Wait at least six months after a widow's spouse passes away to allow proper time for mourning.
• Financial accounts should be easy to access and flexible.
• Immediate needs should be addressed before any financial or estate planning.
• Do not be afraid to seek professional services such as counseling if needed.

If you are a widow needing help reevaluating your estate plan, contact us to seek experienced counsel for your estate.

Reference: Wills, Trusts & Estates Prof Blog (February 10, 2015) "Planning Tips For Widows."

Late Iowa Attorney Being Sued for Estate Settlement Fraud

The parents of a Hudson boy who died in a 2011 water skiing accident said they were bilked by their former attorney.

Attorneys and estate executors should be trusted to do what is right when they represent your estate or the estate of your loved ones. Unfortunately, this is not always the case.

A young man named Bodee Peterson died from injuries sustained in a water skiing accident in 2011. The family hired attorney David Alan Roth to press claims for the estate against the responsible party. A settlement was eventually reached.

The family is now alleging that Roth misled them about the amount of the settlement. Roth was to have set up annuities for Peterson's siblings, something he allegedly failed to do.

A surprise twist to the story? Roth committed suicide a few months ago.

Consequently, the Peterson family is pursuing its claims against his estate.

The WCF Courier has more of the story in an article titled "Bodee Peterson's parents file claim against Roth estate."

A key takeaway from this story is this: if you are overseeing a loved one's estate, it is very important that you hire the right attorney to pursue any claims that the estate has. In addition, stay on top of things. You should contact the attorney regularly so you know what is happening and make sure that the attorney is on top of things.

If you have questions regarding estate claims please contact us today to find answers and peace of mind.

Reference: WCF Courier (February 8, 2015) "Bodee Peterson's parents file claim against Roth estate."

Estate Planning Changes from Obama’s Budget Proposal

Just when you thought the estate tax laws were permanent, President Barack Obama comes out with a comprehensive plan for changes that would take away many strategies that save wealthy families taxes.

As we’ve said before, estate planning is not a one-time project. As life changes, you need to make adjustments to your plan. And the same notion goes for any changes in the law.

Now that President Obama has released the full details of his latest budget proposals and experts have had time to review them, details are emerging about some of the big changes that could be in store for wealthy families' estate plans if the budget proposals pass.

Forbes has a complete rundown of the proposed changes in an article titled "Obama Budget Would Upend Estate Plans."

While you will want to read the original article, here are some of the highlights:

• Reducing the estate tax exemption to 2009 levels and increasing the top tax rate.
• Reducing the lifetime gift exemption.
• Placing restrictions on grantor retained annuity trusts.
• Eliminating the step-up basis on capital gains for heirs.

President Obama has also proposed a whole host of other tax changes designed to force wealthy individuals to pay more in taxes. While not all of the President's proposals will pass Congress, many of them might.

Consequently, it is very important that you pay attention to what these tax hikes might mean for your taxes and your estate plan. If the laws change, you may need to change your estate plan as soon as you possibly can.

Be sure to consult an experienced estate planning attorney sooner rather than later. We are prepared to discuss the effect these changes may result in for your estate plan. click here to contact us today.

Reference: Forbes (February 5, 2015) "Obama Budget Would Upend Estate Plans."

A Super Bowl Win Won't Get Tom Brady out of Paying His Taxes

A Super Bowl win and a free truck? Tom Brady has a lot to celebrate. In fact, he’s so happy he may even give his new truck to a teammate. The catch? Something he may not celebrate is the tax bill to follow.

What did you think of this year’s Super Bowl? If you didn’t catch the big game, let me fill you in.

Seattle had the ball with a few seconds left and needed only to run the ball a couple of yards to enter the end zone, win the game and make history. Despite having one of the best running backs in football, Seattle chose to pass in a much criticized play.

The result of the play was an interception by a “Cinderella story” defensive back and a victory for the New England Patriots.

Patriots quarterback, Tom Brady, was awarded the MVP trophy for the game. Along with the honor, Brady won a new truck. It turns out, however, that Brady will have to pay income and gift tax on truck.

This tale is told in a recent Forbes article titled "IRS Is Coming After Tom Brady's Super Bowl MVP Truck".

The truck is considered a taxable prize, thus Brady has to pay income tax on it. Fair enough.

Yet Brady has also stated that he is going to give the truck to teammate Malcom Butler who made the interception to seal the victory.

The problem?

Because the truck is worth more than the yearly individual gift tax exemption (i.e., $14,000), Brady will have to also pay the gift tax on the truck if he follows through with his announced intentions. Butler, however, will not have to pay tax on the truck as there are no gift tax consequences for the recipients of gifts.

Fortunately, Brady will be able to lessen the gift tax bite if he and his supermodel wife engage in “gift splitting” to permit her individual gift tax exemption to be applied against the value of the gift.

Before making any sizeable gifts, be sure to consult with an experienced estate planning attorney.

Reference: Forbes (February 4, 2015) "IRS Is Coming After Tom Brady's Super Bowl MVP Truck"

Social Media Post Led Robbers to Steal Inheritance

Authorities said the men said during the robbery that they had seen recent social media postings from a resident that he had just inherited some expensive jewelry.

Social Media safety lesson: don’t post about your inheritance!

Police in Pennsylvania say that a 19-year-old made social media posts about some expensive jewelry he had recently inherited. Not a good idea, so it turns out.

This public posting led to a home invasion.

One morning armed, masked men invaded the poster's home and made reference to the social media posts during the robbery.

Penn Live has more on the story in an article titled "Pa. home robbed after man posts on social media about inheritance."

This story highlights why most estate planning attorneys advise their clients to keep their estate plans private. Other people do not need to know what someone else will or has inherited. Period.

Accordingly, if the wrong people learn about an estate plan or an inheritance, then they know whom to target for a robbery or other criminal activity.

For help on how to keep your estate plan or inheritance private, visit an experienced estate planning attorney.

Reference: Penn Live (February 8, 2015) "Pa. home robbed after man posts on social media about inheritance."