San Antonio, TX Estate Planning

Illinois Bill Proposal Would Treat Digital Assets Like Physical Assets

A bill in the General Assembly would treat individuals' Facebook, Twitter, email and other online accounts the same as physical assets after death.

By default, the law does not treat digital assets the same way that it treats physical assets. After a person passes away, physical assets become part of the estate. Executors and loved ones are given access to the physical assets to dispose of them in accordance with an estate plan.

However, treatment of digital assets is determined by the terms of service of online companies.

This creates problems for executors who often need access to the digital assets to properly administer the estate as many technology companies make that access incredibly difficult to get.

Throughout the country state legislatures have debated this problem in an effort to reach a solution. The latest to do so is Illinois.

Its legislature is currently taking up a bill that would treat digital assets as physical assets, which would allow a court to appoint a trustee to access them. The bill is strongly opposed by technology companies and privacy groups who think the bill would be a violation of the deceased's privacy.

The State Journal Register has more on the debate in Illinois in an article titled "Bill would treat deceased's online accounts like physical assets."

This is not a debate that is going away soon.

It will likely take years for any sort of consensus to develop throughout the country. In the meantime, it is important to talk to your estate planning attorney about what you can do to ensure that your digital assets are handled appropriately in your estate.

Contact us to have this discussion early on.

Reference: State Journal Register (April 5, 2015) "Bill would treat deceased's online accounts like physical assets."

Beware – Inheritance Thief!

A 'black widow' who married a man on his death bed just eight days before he died has been jailed for stealing his granddaughter's inheritance.

Being the administrator of an estate comes with great responsibility. Who would you choose to handle your own estate? Can they be trusted to do as you wish?

Eight days before he passed away, Roy Mitchell married a woman named Judith Brown. Months prior, Mitchell had already changed his estate plan to leave the bulk of his assets to Brown. However, he still stipulated that a portion of his estate was to be divided between his four grandchildren.

As the administrator of the estate, Brown's job was to make sure that the grandchildren received their money. However, she never gave any of the funds to the grandchildren.

Instead, Brown spent it on herself. She has now been imprisoned for two years for theft.

The Daily Mail  has more on the story in an article titled "'Black Widow' who married man on his death bed just eight days before he died is jailed for stealing his grandchild's inheritance."

A criminal conviction and jail time are among the potential consequences awaiting administrators who do not properly distribute an estate under their charge. An administrator can also be forced to pay the money back out of his or her own assets.

This is one reason why an administrator should have an attorney to assist with the estate. Not only can the attorney guide the administrator through the legal hoops, but he or she can help make sure all is done according to the estate plan.

In Brown's case it appears she acted intentionally. However, even if you have no intention of mismanaging the estate, you can be held liable if things go wrong.

Again, it cannot be emphasized too emphatically - you need an attorney to help ensure everything is done correctly. It's never too early to protect you and your heirs. Click here to read more about what is involved with setting up your estate plan.

Reference: The Daily Mail (March 12, 2015) "'Black Widow' who married man on his death bed just eight days before he died is jailed for stealing his grandchild's inheritance."

Lawmakers Debate Issue of Digital Privacy after Death

Does a person's right to privacy extend past death? In this digital age, yes, according to legislation passed by the 2015 General Assembly — the first of its kind in the country. The Privacy Expectation Afterlife and Choices Act aims to assure that a person's electronic footprint remains off-limits after death — even to his or her close kin — except under very strictly controlled circumstances.

Have you ever wondered what will happen to your digital accounts after you die? Will anyone have access to your email or Facebook page?

One the biggest problems estate administrators face today is gaining access to a deceased person's online accounts. Digital accounts such as email, online payment sites and even social media accounts can contain valuable information and clues about the deceased's business and financial dealings. Not having access to that information can hamper administering the estate.

Nevertheless, most technology firms have taken the stance that digital accounts remain private after death and consequently they make gaining access difficult.

In Virginia, legislation is awaiting executive branch action that would allow executors access to digital accounts, if certain conditions were satisfied.

Legislation initially proposed was supported by estate attorneys, but fiercely opposed by technology industry lobbyists. A counter bill was proposed that would keep digital accounts private after death.

The two sides reached a compromise that would allow executors access to information for the 18 months preceding a person's death. However, to actually access the information, prior consent of the deceased would be needed.

Thus, for an example, an executor could see who sent the deceased emails, but could not read the contents of the emails themselves without prior consent.

As reported by The News Tribune in an article titled "Va. legislation seeks to protect digital privacy after death," the proposal has passed the legislature and awaits the signature or veto of the governor.

Reference: The News Tribune (March 7, 2015) "Va. legislation seeks to protect digital privacy after death"

Ernie Banks' Estate Administration under Fire for Unpaid Funeral Expenses

The funeral home that handled services for Chicago Cubs great Ernie Banks has jumped into the legal battle over the estate of the Hall of Famer with a claim for more than $35,000 it says it has not been paid.

Unfortunately, the drama continues for the estate of Ernie Banks. First, there are the accusations that his longtime caregiver, Regina Rice, arranged a secret will that left the entire estate to her and disinherited his family for unknown reasons. Rice says that the will is legitimate, and her attorney recently claimed that the estate has assets of only $16,000. The court has ordered a full accounting as the family believes there should be much more.

Now, the funeral home where services were held for Banks has filed a lawsuit against the estate for $35,000 it says it has not been paid. The Star Tribune has more on the story in an article titled "Funeral home jumps into legal battle over Ernie Banks estate with demand for $35,000."

One issue should be obvious here. If Rice is correct about the value of the estate, then the funeral home is owed more money than the estate has.

The other issue is a failure of estate administration.

Normally, one of the first things an executor should do is to ensure payment of the deceased's funeral expenses. The failure to do so allows fees and interest to accrue. If the estate could not pay for the funeral, then a less expensive funeral should have been arranged.

If you need guidance and help administrating an estate, contact us to experience relief and support during this time.

Reference: Star Tribune (March 6, 2015) "Funeral home jumps into legal battle over Ernie Banks estate with demand for $35,000"

Scandal, Disinheritance and One Son’s Quest to Find Hidden Millions from Father’s Estate

Sidney Kronenberg, who owned an East Williamsburg hardware business called Brown Industries Inc., died in 2010 with about $8 million that has been accounted for, according to court records. But his son, S. Harris Kronenberg, says there is much more money out there hidden in offshore accounts and under aliases — and he bases his belief on his dad’s criminal past.

Does the name Kronenberg ring a bell? The late Sidney Kronenberg is perhaps most famous for being a part of a New York bribery and kickback scandal that Rudy Giuliani prosecuted in the 1980s. Kronenberg was convicted in the scandal but never received prison time.

When the hardware store owner passed away, it was discovered that his will disinherited his daughter and left his son a small portion of the total value of the estate. The son and daughter took the unusual step of hiring an expert to diagnose their father's mental condition after he was already dead.

This unusual step proved successful. The son and daughter were able to settle with the estate and received a large share of it.

As reported by DNAinfo in an article titled "Owner of Brooklyn Hardware Store Hid Tens of Millions of Dollars, son says," the son petitioned the court two years ago to take over administration of the estate. The son believes his father hid money all over the world using false names and social security numbers.

However, two years of searching has not produced any results.

This particular family struggle with an estate might have been unavoidable since it appears that Kronenberg did not get along with his children. Normally, the key to avoiding a family feud over an estate is open communication and that may not have been possible here.

It is smart to engage the services of an experienced estate planning attorney early in the planning process. We can help you navigate these treacherous waters.

Reference: DNAinfo (March 5, 2015) "Owner of Brooklyn Hardware Store Hid Tens of Millions of Dollars, son says" 

How to Pay Estate Creditors

In deciding how best to approach an estate matter, it is important to be aware of how the estate creditors are to be paid.

What happens to your debt when you pass away?

Most Americans have debts of some kind and most debts do not disappear when the debtor passes away. Instead, the debts are paid out of the assets of the estate before the assets are distributed to the heirs. 

NJ.com recently published a helpful article about this subject titled "What you need to know about estate creditors." 

While the article is written specifically about New Jersey law, there are some generally applicable notables that are helpful reminders for all estate administrators.

The first thing to understand is that not all debts presented to the estate need to be paid. Only valid debts should be paid. 

Debts can be invalid for a variety of reasons, such as the creditor cannot prove that the debt is owed or perhaps the statute of limitations has run on the claim. Another important thing to understand is that creditors should be paid in a specific order depending upon the type of debt. 

While the specific order might change from state to state, it is important to note the debts to the government for taxes should always be paid before private debts! Finally, if there is not enough money in the estate to pay all of the debt, administrators need to be very careful and properly pay each creditor the appropriate amount from what is available.

Of course, the best thing for estate administrators to do when it comes to creditors, let alone estate administration, is to hire an experienced estate planning attorney to assist.

If you’re the responsible estate administrator, we can help you take care of matters appropriately. Click here to read about our probate services.

Reference: NJ.com (March 1, 2015) "What you need to know about estate creditors."

Estate Administration 101: Pay Applicable Taxes

When a loved one dies, the resulting tax issues must be handled.  The person to handle these issues is typically identified in the decedent’s will as executor of the estate.  However, if there is not a will, the probate court will appoint someone to be the administrator.

Nothing is certain but death and taxes, right? Which is why an estate executor has an important role.

An executor has two basic functions. The first is to marshal the assets of the estate. That is the executor must locate and document the assets. The executor must also then distribute the assets. This is actually three functions in one.

The executor must pay the debts of the deceased out of the estate assets, pay the taxes and then distribute the remainder to any heirs. Many new executors get tripped up on the taxes as they do not know what taxes need to be paid. Problem: the executors may be held liable for any tax deficiencies owed by the estate.

The Wills, Trusts & Estates Prof Blog recently published a helpful list of taxes for estate administrators titled "Tax Issues When Closing an Estate."

Here are some of the practical pointers included in this list:

• Filing a final 1040 - An income tax return needs to be filed for the last tax year the deceased was alive. This should cover the period from January 1 until the date of death.
• Filing the estate's income tax returns - If the estate earns money after the deceased passes away, the estate is responsible for paying income taxes on that money.
• Filing an estate tax return - If any estate tax is due, then an estate tax return must be filed.
• Miscellaneous - Many estates have several other tax issues to deal with that executors should consult with experts about.

If you are administering an estate and have any questions about taxes, contact us to see an experienced attorney about what you need to do. The fees for the attorney are a legitimate estate expense and can protect you from liabilities flowing from your role as executor.

Reference: Wills, Trusts & Estates Prof Blog (February 17, 2015) "Tax Issues When Closing an Estate."

Inheriting a Classic: When Books Are Valuable

Many people tend to overlook books as potential assets. And even if you bring a rare book to a general antiques dealer or estate appraiser, they often are not qualified to give specialized book appraisals. This can be a mistake: The simple fact is, books can be worth money.

So, you inherited a book. Now what? Before you head off to the local library to donate your literature, make sure you do some research on the value of the gift.

People collect all sorts of items during their lives. Most of these items have little value other than sentimental value. Some items, however, are extremely valuable. Things such as jewelry with rare gems, old coins, stamps, antiques and more can be worth a lot of money. When administering an estate, these items need to be appraised by experts. This is an important part of determining the overall assets of the estate.

A recent post at the Wills, Trusts & Estates Prof Blog, titled "Inheriting Old and Rare Books in an Estate," reminds people that books can also add value to the estate and may also need to be appraised by an expert.

It is easy to see why people often overlook books. If you have ever been to a typical second hand book store, you know that most used books are sold for no more than a dollar or two. Thus, most of the time, a random box of books found with a deceased's belongings is not going to have any real value. However, there is another market for books out there.

Many people collect old and rare books. These are often books published centuries ago or they are first editions of celebrated works. So while a collection of science fiction paperbacks is probably best donated to a local library, old leather bound volumes should probably be looked at by an expert as they might be valuable.

Books, of course, are not the only valuable items that are sometimes overlooked. The important thing to remember when administering an estate is this: if you are not sure whether or not something is valuable, seek out an expert who will know. Better yet, work with an experienced estate planning attorney to make sure all aspects of the estate administration proceed according to Hoyle.

Reference: Wills, Trusts & Estates Prof Blog (October 10, 2014) "Inheriting Old and Rare Books in an Estate"