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:
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.
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.
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.
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.
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.
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:
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.
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.
Make Certain Your Estate Plan Works as Everything Else Changes
As everything around you changes, you may not recognize the impact the changes have on your estate plan.
Laws change; your health and financial condition change; the health and financial condition of your beneficiaries change; maybe your beneficiary designations change as your assets change; and the fates of the people you are depending on to act as your Executors, Trustees, agents under a power of attorney and health care representatives change.
Attorney Richard S. Land will discuss how to make certain that such changes will not interfere with, or totally disrupt, your estate plan.
Elder Law in a Nutshell
What is Elder Law and how can an Elder Law attorney help you through the complex issues associated with aging?
The special needs of the elderly are not unique to the elderly, however. Persons of all ages may suffer from chronic conditions resulting in special needs requiring specialized legal help.
Attorney Alyson Marcucio will cover legal issues and solutions related to the special needs of the elderly and all others with special needs.
Estate Planning for Beginners: Features of Wills, Trusts and Powers of Attorney
What is the difference between a will and a revocable trust? What are the powers in a Power of Attorney? Do I even need an estate plan?
Attorney Elizabeth J. Hartery will answer those questions and many others in her presentation, which will explain the basic features of wills, trusts, Powers of Attorney, living wills and more.
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.
On April 28, 2018, we posted to YouTube our video entitled “Pass Through Deductions and Other Tax Cuts and Jobs Act Subjects”.
Part I 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 II 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”).
We hope these videos are helpful. Please let us know if you have any questions.
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