Archive for the ‘Estate Tax and Estate Planning Developments’ category

What You Need to Know About Being a Trustee – Video Update

May 17, 2020

Trust law in Connecticut was changed recently so we updated our Trusts and Trust Administration Video.

If you are named as a Trustee in the Will of a relative or friend, there are a number of duties, and related traps, you need to be aware of. Your responsibilities will be many.  It’s easy to get overwhelmed or miss something important. Watch the video below to learn about the duties of a Trustee and common problems Trustees face.

Help others find our informative videos. If you find this video helpful, please “like” it and share it with your friends.
An update of our video on Estate Settlement is in the works. Stay tuned. If you subscribe here: YouTube channel, you’ll be notified as soon as it’s posted.
If you are a trustee who has been struggling to manage a trust, or if you have any basic questions, please contact us. We are here to help.
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Posted by Richard S. Land, Attorney, Chipman Mazzucco  Emerson LLC, Attorneys at Law, Danbury, CT, 06810, 203-744-1929 x29, rsl@danburylaw.com.

Let’s Talk About Estate Planning (Ounce of Prevention Episode 2)

May 17, 2020

On March 5, 2020, Attorney Timothy Herring, the head of Chipman Mazzucco Emerson’s litigation practice area, launched the Ounce of Prevention podcast. The first episode is entitled What Does a Litigator Actually Do?  Listen to the first episode here: Episode One: What Does a Litigator Actually Do?

Liz Hartery

On March 31, 2020, Attorney Liz Hartery, of Chipman Mazzucco Emerson’s estate planning and probate group, appeared as a guest on Tim’s second episode entitled Let’s Talk About Your Estate Planning.  Listen to Liz’s comments on estate planning here: Episode Two: Let’s Talk About Your Estate Plan.

Estate plans are so much more than just a Will. Tim and Liz have a light-hearted discussion covering a number of estate planning options and techniques including living trusts, living wills, how to deal with difficult family issues, and what people need to know about pet trusts.

Subscribe to the Ounce of Prevention podcast. In each episode, Tim will focus on a specific legal issue and how it could impact your everyday life.

The goal of the podcast is to educate and inspire our listeners to harness the law to make life just a little bit easier.

For more information about topics mentioned in the podcast, contact Tim Herring at 203-744-1929 x19 or tmh@danburylaw.com. Visit our website at https://www.danburylaw.com/ to learn more.

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Richard Land

Posted by Richard S. Land, Attorney, Chipman Mazzucco  Emerson LLC, Attorneys at Law, Danbury, CT, 06810, 203-744-1929 x29, rsl@danburylaw.com.

Thank You, From All of Us

May 16, 2020

The Chipman Mazzucco Emerson attorneys and staff would like to thank all of the Health Care Providers and First Responders who are working on the frontlines during the COVID-19 Pandemic.

Frontline Estate Plan Package

Just as you are helping all of us, we would like to help you. A link at the end of the video will bring you to information about our special Frontline Estate Planning Package offered at a well-deserved savings for health care providers and first responders. We sincerely hope that you will forward this within your organizations or to anyone close to you on the frontlines.

Posted by Alyson R. Marcucio, Attorney, Chipman Mazzucco  Emerson LLC, Attorneys at Law, Danbury, CT, 06810, 203-744-1929 x40, arm@danburylaw.com.

Complimentary Online Estate Plan Review

May 15, 2020

Does the pandemic have you worried about whether your existing estate plan works for you now?

Or maybe you are simply using the enforced quarantine time to catch up on important things that you keep putting off.

Either way, Chipman Mazzucco Emerson has an easy way to guide you through what you need to know to make sure your estate plan is updated and meets your current needs.

Our complimentary updated Online Estate Plan Review asks a series of specific questions that will alert you to issues you should address to make certain your plan still works. The latest version of this program covers a number of recent law changes, including:

  • The Tax Cuts and Job Act of 2017
  • SECURE Act of 2019
  • Numerous changes in State and federal estate tax exemptions

You can complete the process in ten to fifteen minutes. When you are finished, you’ll receive a detailed personalized report that identifies issues that require your attention.   Here is our new video explaining how the review works and how to register for your personalized report.

To access our complimentary Online Estate Plan Review, please click on the link or image below:

Complimentary Online Estate Review Plan

We hope our online estate plan review helps you.  If you have questions about the review, please call.

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Posted by Richard S. Land, Attorney, Chipman Mazzucco  Emerson LLC, Attorneys at Law, Danbury, CT, 06810, 203-744-1929 x29, rsl@danburylaw.com.

Estate Planning After the Tax Cuts and Jobs Act

May 12, 2020
richard

Richard S. Land, Attorney

To help you face your estate planning challenges, we have updated our Basic Estate Planning video presentation to cover the Tax Cuts and Jobs Act (effective January 1, 2018) and the SECURE Act (effective January 1, 2020).  You can take a look at the video here (Basic Estate Planning After the Tax Cuts and Jobs Act) or below.

Here is a very brief summary of what the videos cover:

Parts 1 and 2:  No matter where you live (or die), your estate plan can be destroyed if you don’t know the difference between probate property and non-probate property.  We cover this distinction in Part 1.  We also cover what a trust is and how a trust can help accomplish certain estate planning goals:  protecting assets from the beneficiary’s creditors and risks; asset management for a beneficiary who needs management help; estate tax reduction; and more.  We acknowledge that the unfortunate Connecticut estate tax exists (and many other states do not have an estate tax) but, in most cases, we can help with effective workarounds.  Part 2 covers Connecticut and federal estate taxes (also New York estate taxes) including how life insurance death benefits are taxed for estate tax purposes.

Parts 3 and 4:  Your Will can include provisions that reduce or eliminate estate taxes.  Parts 3 and 4 describe such Wills.  Danger: Existing Wills with old estate tax provisions can have the unintended effect of disinheriting a spouse.  We cover how to deal with such a risk.  We also cover new rules allowing one spouse to give his or her federal estate tax exemption to the surviving spouse.  The surviving spouse’s federal estate tax exemption could be more than $11,580,000.  In addition, we cover Will provisions that can protect assets from a beneficiary’s long term care costs.

Parts 5 and 6:  Not all trusts that are designed to save estate taxes are the same.  Part 5 compares the different types of trusts.  As Part 5 ends, we begin a discussion of common estate planning mistakes and Part 6 continues the discussion.

Parts 7 and 8:  These parts cover estate tax and income tax planning for retirement accounts such as 401(k) accounts and IRAs.

Part 9 to Part 13:  These parts include a complete discussion of revocable living trusts with a comprehensive comparison between a plan that uses a revocable trust and a plan that relies on a Will without making use of a revocable living trust.  Part 13 ends with a description of how Connecticut probate court fees are calculated.

Part 14:  This part covers the basic gift tax rules and techniques.

Part 15:  This is the final part and covers gifts of life insurance policies with brief mention of other advanced gift techniques.

We hope our updated basic estate planning videos help you.  If you have questions about any of the estate planning concepts mentioned in the video, please call.

185775_1745456110853_1072275011_31952001_6630745_n[1]Posted by Richard S. Land, Attorney, Chipman Mazzucco  Emerson LLC, Attorneys at Law, Danbury, CT, 06810, 203-744-1929 x29, rsl@danburylaw.com.

 

Tax Increases on Retirement Plan Accounts: A Simple Change Adds to Complexity

May 12, 2020

Washington has been salivating over the potential that retirement accounts represent for increasing tax revenues. If only such accounts (IRAs, 401(k) plans, 403(b) plans and similar retirement accounts) could be subjected to tax now….

The SECURE Act (effective January 1, 2020) is a step toward increasing taxes on your retirement accounts. Ironically, the acronym SECURE stands for “Setting Every Community Up for Retirement Enhancement.”

On January 20, 2020, we posted an update of Part 8 of our Basic Estate Planning Video Series (called Basic Estate Planning after TCJA). In updated Part 8 we cover the new rules under the SECURE Act that affect your estate planning. Please click here,or on the video link below, to watch Part 8 (15 minutes).

Help others find our informative videos. If you find the video helpful, please “like” it and share it with your friends.

In theory, the most significant new rule appears simple: with limited exceptions, most inherited retirement accounts must be withdrawn within ten calendar years after the year in which the account owner passes away. The simplicity of this change masks the complexity of the calculations that may be needed when you are making estate planning decisions regarding your retirement accounts. 

If you know the new rules, you will begin to understand why it may make sense

  • to consider converting to Roth IRAs before you pass away;
  • for a surviving spouse to consider converting part of the spouse’s regular or rollover IRA to a Roth IRA;
  • to consider leaving some of your IRA directly to your children instead of to your surviving spouse while also leaving a large part of your IRA to your surviving spouse;
  • in some cases, for the beneficiary to take no distributions from the IRA until the tenth year after the owner’s death and in other cases to take much earlier distributions; and
  • in some cases to use trusts as beneficiaries of retirement accounts when, in the past, you would have been more inclined to name individuals.

The conclusion is the same as always. More complexity means more need to consult with your accountants and financial advisers (and maybe with your lawyers).

We hope these materials add to your understanding. Please let us know if you have questions.

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Posted by Richard S. Land, Attorney, Chipman Mazzucco Emerson LLC, Attorneys at Law, Danbury, CT, 06810, 203-744-1929 x29, rsl@danburylaw.com.

Seminar: How Resilient is Your Estate Plan? Will Your Plan Work as Things Change?

October 8, 2019

Estate Planning Seminar!

October 17, 2019

We invite you to a free seminar on October 17, 2019, at the Ethan Allen Hotel in Danbury, Connecticut (21 Lake Avenue Ext).

Topic: How Resilient is Your Estate Plan?

The presentation will start at 6:30 PM.

To register, call 203-744-1929 (please provide your email address) or email us at dvv@danburylaw.com.  You also can register here: Seminar Registration.

Informative and fun. Come learn and have a great time.

We intend to cover changes of all kinds (not just law and taxes) that will most affect your estate plan.

Reconnect with all the attorneys in our estate planning and probate practice group.

Topics include:

  • Probate Courts
  • Issues related to Change of Residence
  • Coping with the Surge of Conservatorship Proceedings
  • How Estate Planning Changes with Each Stage of Life
  • Changes in Law that Could Affect Your Estate Plan.

The presentation will start at 6:30 PM. Light refreshments will be served.

To register, click below or call us at 203-744-1929 or email us at
dvv@danburylaw.com.

REGISTER HERE


The Presenters and Their Topics:

Richard L. Emerson

Topic: Insights from a Former Probate Judge

The Probate Courts have been affected by important changes. Attorney Richard L. Emerson will inform us about the workings of the Probate Courts as only a former Probate Court Judge can.

Attorney Richard L. Emerson served as the Probate Judge in Redding, Connecticut, for over thirty years. His legal practice concentrates on estate administration, probate, estate planning, trust and estate disputes and general corporate representation. He also has mediated contested probate matters and has appeared as an expert witness for other attorneys.

James J. Flaherty, Jr.

Topic: Thinking About Moving Out of Connecticut? Consider
This.

We often hear about people moving out of Connecticut. Is this merely a case of “the grass is always greener…”? James J. Flaherty, Jr., will discuss issues related to a change of residence. Whether you stay or go, if you are wondering about leaving, this is information you need.

Attorney James J. Flaherty, Jr., practices from the firm’s Southbury office and is a member of the estate planning and probate group. Jim’s practice focuses on assisting high net worth individuals, including closely held business owners, in the creation of wealth succession plans. In addition to estate planning, Jim works with individuals on Medicaid (Title 19) and asset protection planning.

Alyson R. Marcucio

Topic: Coping with the Surge in Conservatorship
Proceedings

The increasing number of conservatorship proceedings creates additional demands on our Probate Courts. Alyson R. Marcucio will discuss planning steps to work around crowded court dockets and long wait times.

Attorney Alyson Marcucio is a member of the firm’s estate planning and probate group, with an emphasis on elder law and
planning for those who have chronic disabilities. Alyson’s practice includes long term care, incapacity and special needs planning, eligibility for Medicaid and other public benefits, and conservatorship proceedings.

 

Elizabeth J. Hartery

Topic: Estate Planning for Each of Life’s Stages

Life is often thought of as having twelve stages. Estate planning starts with the sixth stage and ends with the twelfth: late adolescence; early adulthood; midlife; mature adulthood; late adulthood; and death and dying. Liz Hartery will discuss how the planning focus changes as we pass through each stage.

Attorney Elizabeth J. Hartery is an associate in the firm’s estate planning and probate group, assisting with estate planning, estate settlement, probate matters, and elder law issues.

 

Richard S. Land

Master of Ceremonies

Attorney Richard S. Land heads up the firm’s estate planning and probate group, helping individuals from all walks of life to manage and dispose of their assets in an orderly fashion through lifetime transfers and through transfers at death by wills and trusts.

Richard has authored and produced dozens of educational videos on estate planning and trust and estates topics, authored several computer generated estate planning document assembly systems and authored an online estate plan review program.

No Admission Charge

Our seminars are always strictly educational and well attended.  Space is limited so please let us know if you plan to attend.

Light snacks, desserts and beverages will be offered.

To register, click on this link: Seminar Registration.

Please join us at the Ethan Allen Hotel (21 Lake Avenue Ext., Danbury, CT) on October 17, 2019.

We look forward to seeing you.

Chipman Mazzucco Emerson LLC
Attorneys at Law
44 Old Ridgebury Road
Suite 320
Danbury, CT 06810
203-744-1929

 

Is Rental Property Income Eligible for the Pass Through Income Deduction?

February 24, 2019

On January 18, 2019, final regulations and a special notice were published regarding the 20% income tax deduction related to certain pass through income. 

Trade or Business?

The Notice (Notice 2019-07) offers owners of rental real estate an opportunity to benefit from significant deductions related to rental income.  This blog discusses the content of the Notice.

As an appendix to previously posted videos on the pass through income deduction, we posted a video regarding the Notice: 

For the other videos on the pass through deduction, click on this link:  Pass Through Deductions and Other Tax Cuts and Jobs Act Subjects

This blog is to discuss the Notice 2019-07 in more detail. 

It’s not always easy to determine whether your rental real estate activity satisfies the somewhat vague definition of a trade or business so the IRS tried to provide a bright line test (call it a “safe harbor”) for determining whether the deduction will be available to you for the rental income you receive.

The safe harbor is described in Notice 2019-07 in the form of a Proposed Revenue Procedure.  If your rental activity income satisfies the criteria described in the Notice, you can be confident that your rental activity income will qualify for the 20% pass through income deduction under section 199A of the Internal Revenue Code.

The safer harbor provisions apply only to Rental Real Estate Enterprises.  A Rental Real Estate Enterprise is an interest, or multiple interests, in real estate held directly by an individual or Relevant Pass Through Entity (aka “RPE” such as a limited liability company, S corporation or partnership), for the production of rents but the definition excludes triple net leases and interests used to any extent as a personal residence.  Commercial and residential real estate cannot be part of the same Rental Real Estate Enterprise.

For purposes of the 20% deduction that applies to pass through income under Section 199A of the IRC, your Rental Real Estate Enterprise will be deemed a trade or business if certain requirements described in the Notice are satisfied.  Keep in mind that only certain income of a trade or business can qualify for the deduction so this is a key point for income earned through your rental activities.

The Notice says that your rental activity will be treated as a trade or business if (i) you maintain separate books and records for each rental real estate enterprise; (ii) you or your agents devote 250 or more hours per year to rental services with respect to the rental real estate enterprise; and (iii) you keep contemporaneous records related to the rental services. 

The records must include: (i) the hours performed, (ii) a description of the services performed, (iii) dates on which the services were performed, and (iv) who performed the services. 

The requirement that the records must be contemporaneous has been waived for 2018 so, if you do not have good records for 2018, you can try to do the best you can to reconstruct how you performed rental services in 2018.

Some things you do will count as rental services and some things will not.  The Notice includes a specific list of activities that count as rental services.  Here is the list:

  • Advertising to rent or lease property;
  • Negotiating and executing leases;
  • Verifying information in the applications of prospective tenants;
  • Daily operations, maintenance and repairs;
  • Management of real estate;
  • Purchasing materials; and
  • Supervision of employees and independent contractors.

Keep in mind that you will get credit for the time put in by your employees, agents and independent contractors so, if you have others doing the work for you, you should insist that they keep contemporaneous records of the work they do.

Also keep in mind that some of the time devoted to your rental activity will not count as rental services.  The time you or your agents spend traveling from property to property will not count.  Also, time devoted to financial and investment management relating to your real estate rental activities will not count.  Accordingly, the time you spend arranging financing, acquiring property, studying or reviewing financial statements or reports regarding your properties, or planning, managing, or constructing long term capital improvements will not count.

To claim the benefits of the safe harbor, you must file a statement indicating that all the requirements of the Notice have been satisfied. The statement must be signed by the taxpayer or authorized representative and include the following:

“Under penalties of perjury, I (we) declare that I (we) have examined the statement, and, to the best of my (our) knowledge and belief, the statement contains all the relevant facts relating to the revenue procedure, and such facts are true, correct, and complete.”

We are currently working on Section 2 of Part 3 of our video which will cover:

  • Planning to avoid the phase-out zone;
  • Additional planning to maximize pass-through income deductions based on wages and capital expenditures;
  • How transferring business interests to family members and trusts can create additional pass through income deductions; and
  • How converting pass through income to wages can increase pass through deductions.

You can access our playlist of previously posted videos by clicking on this link: Pass Through Deductions and Other Tax Cuts and Jobs Act Subjects.

To subscribe to the YouTube channel click here:  YouTube Channel.

Posted by Richard S. Land on February 24, 2019.

Chipman Mazzucco Emerson
Attorneys at Law

We frequently post articles relating to estate planning, estate settlement and elder law issues to this blog. We also post notices about our client seminars here. When we do, we send out notices to clients and friends of the firm. If you would like to get our notices, please join our mailing list by clicking below.

 
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Seminar Video: Basic Estate Planning and Elder Law in a Nutshell

January 19, 2019

We recently posted to YouTube the video of our annual fall estate planning seminar (held on October 25, 2018). Here is a playlist containing all three segments: Basic Estate Planning and Elder Law in a Nutshell.

Basic Estate Planning and Elder Law in a Nutshell

In Video 1 (Estate Planning for Beginners), Elizabeth J. Hartery covers the basics of Wills, revocable trusts, powers of attorney, conservatorships and health care directives including living wills. Approximately 30 minutes.

In Video 2 (How to Make Certain Your Estate Plan Works as Everything Else Changes), Richard S. Land covers the reasons why an estate planning review might be necessary including new legislation. Approximately 35 minutes.

In Video 3 (Elder Law in a Nutshell), Alyson Marcucio covers the practice of elder law as part of the continuum of planning for the welfare of the family.  In the case of elder law, this means counselling and representing seniors and the disabled as well as their representatives (such as conservators, trustees and agents under a power of attorney) and family members regarding a range of issues including health and personal care, legal capacity, public benefits, special needs, insurance, housing options and more.  Approximately 24 minutes.

We hope these presentations are helpful.

Posted by Richard S. Land on January 19, 2019.

Chipman Mazzucco Emerson
Attorneys at Law

Maximizing Pass-Through Income Deductions (Third Video in a TCJA Series)

December 9, 2018

We recently posted our third video covering the Tax Cuts and Jobs Act provisions that provide a 20% deduction for “pass through income.”  The first two videos (Part 1 and Part 2) covered the rules that apply.

In Part 3 we will be covering planning to optimize the deduction for pass-through income.

Our video posted on December 8, 2018, is the first section of Part 3 and covers planning to maximize deductions by aggregating tax attributes of separate trades or businesses according to proposed regulations which were issued on August 8, 2018. 

The video closes with a discussion on how the rules apply to real estate rental activities.  Can income under a triple net lease qualify for the deduction equal to 20% of pass through income?  Probably not.  Can the lease be tweaked to qualify the rental income for the deduction?  Probably.

Additional sections will be added to Part 3 in the future. 

Watch Section 1 of Part 3 below.

In previous video posts, Part 1 describes how the Tax Cuts and Jobs Act changes the most widely used income tax deductions related to state and local taxes, mortgage interest deductions and personal exemptions.  It also covers how the increased standard deduction and lower rates may make up for lost deductions.

Part 2 explains the income tax deduction available under Internal Revenue Code Section 199A for individuals who receive “pass through income” (aka trades or businesses that generate self-employment income).

As mentioned above,  Section 1 of Part 3 is the first of several sections.  Future sections will cover additional planning opportunities.

We hope these videos are helpful.  Please let us know if you have any questions.

Posted by Richard S. Land on December 9, 2018.

Chipman Mazzucco Emerson
Attorneys at Law


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