With an asset protection plan that uses our proven Estate, Tax, Elder Law, Medicaid and Special Needs Planning strategies, Amoruso & Amoruso, LLP gives you peace of mind by ensuring that your loved ones receive the care that they need.
Did you know that the new Tax Bill proposed by the Republicans threatens the financial independence of Seniors and the Disabled? Read how in this Money Magazine article featuring Elder Law and Estate Planning Attorney Michael J. Amoruso!
Many foreign trusts have failed to register under the new trust laws of New Zealand and may have fled the country, according to the Wills, Trusts & Estates Prof Blog in "Trust the Kiwis."
New Zealand has had lax laws and allowed foreigners to have tax-free trusts with little oversight.
However, the Panama Papers, the leaked emails of a law firm in Panama were released and all that changed.
It was revealed that New Zealand was being used by some very wealthy people to hide assets from their own governments. This created some international pressure on New Zealand by other governments, as those other governments do not appreciate avoidance of their taxes.
In response to this pressure, the New Zealand government changed its trust laws. All foreign trusts were required to register, declare who controlled the trusts and specify who the beneficiaries of the trust were.
It was assumed this move would not be a burden for most foreign trusts, since there are many reasons someone might want to have a tax-free trust in New Zealand, other than tax avoidance.
This suggests that using foreign trusts to hide assets is more common than previously thought.
Reference: Wills, Trusts & Estates Prof Blog (June 20, 2017) "Trust the Kiwis."
Minnesota’s income tax statute makes 100% of a trust's assets taxable in that state, if the trust became irrevocable when the settlor was a resident of Minnesota.
This rule applies regardless of where the trust beneficiaries reside or where any trustees reside.
The court looked at trusts that had an out-of-state trustee, beneficiaries who lived in Minnesota and beneficiaries who lived in other states.
It determined that these trusts could not be considered resident trusts of Minnesota and, therefore, the state could not tax intangible assets. Presumably, the same logic could be applied to some other trust situations.
This ruling could lead to refunds for some trusts.
However, it appears likely that Minnesota will appeal to the Supreme Court.
Getting people and their families to agree to donate organs has proven to be exceptionally difficult. In some cases, it is even difficult to find enough blood donors.
There have been many awareness campaigns, but they normally only have a short-term effect, if they have any at all.
The state is considering offering donors small tax credits for donating blood or organs. In the case of a deceased donor, the tax credit could be used on their final tax return filed by the estate.
Whether these credits would do very much to increase donations is uncertain.
However, these proposals could also be in violation of federal law, which makes it illegal to profit from organ donations. Other states have gotten around that problem by offering tax exemptions for any expense incurred while donating.
It is important to find more blood and organ donors. However, it appears that these New Jersey proposals are likely not going to be solutions, unless federal laws are changed.
When you think taxes, you might think estate plan.
Since you have already done much of the work when you gather the financial material needed for taxes, you might consider following up filing by setting up an estate plan or updating your current plan, according to CTV News in "The mistakes of not having a will.
To do your taxes, you have to get out many of your financial documents. You have also been thinking about how much money you have and where it is all located. Doing those things is one of the main steps to getting an estate plan.
You could put all of your financial documents away and think about other things. However, if you later decided to do estate planning, you will have to start all over again.
Why not just go ahead and get an estate plan now, while things are still on your mind?
Contact an estate planning attorney for guidance on creating your own plan to meet your unique circumstances.
The IRS has set its targets in the past on middle class taxpayers rather than the wealthy, because the wealthy would hire attorneys and accountants to battle for them. However, years of budget cutbacks have changed the agency’s tactics.
There is more money that the IRS can get by auditing the wealthy than by making sure that middle class Americans have filed all of their taxes correctly.
The IRS is expected to go after common ways the wealthy often lower their tax bills and challenge them to prove that they have done everything correctly.
For example, a charitable deduction over a certain limit might trigger the IRS to send a letter demanding proof of the donation. Reporting that money was put into a 529 education savings plan over a certain amount could also trigger an automatic letter, as could a number of other common practices.
An estate planning attorney can guide you into plans that fit your unique circumstances.
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.
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, 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.