Subscriber Library

Asset Protection

• How do you make a client judgment-proof (i.e., no visible assets)?
• Protection from plaintiffs, creditors, and ex-spouses
• Fraudulent transfers
• Structure selection:
  • Corporation, LLC, or LP?
  • Multi-entity structure?
  • Foreign trust?
  • Domestic trust?
• Gift and sale strategy
• Selecting a jurisdiction
• Successor liability
• Charging order protection
• Ethical considerations
• Does a single-member LLC help?
• How and when can you use a poison pill?

Assets: Bank Account

Assets: Brokerage Account

Assets: Business

Assets: Professional Practice

Assets: Real Estate

• Estates in Land
  • Estates in Land: Importance of History
  • Estates in Land Classification
  • Estates in Land: Future Interests - Legal or Equitable
• Landlord & Tenant
  • Implied warranty of habitability bases rights and duties on status

Assets: Retirement Plans

• SECURE Act
• IRA-CRT (either CRAT or CRUT)

Contracts

• Implied warranty bases rights and duties on status

Feudalism

• Types of feudal grants
• Feudalism: A lord’s legal remedies

Guardians

• Guardian can create trust
• Guardian can probably name co-trustee of revocable trust
• Guardian cannot execute will

IRC § 199A

• Do you qualify for the QBI deduction? - a flowchart
• Which form do you use to report the QBI deduction: Form 8895 or Form 8895-A?

Planning for blended Families

Planning for children

Planning for couples who are married

Planning for couples who are unmarried

Planning for long-term care

Power of Attorney

Powers of Appointment

• Definitions
  • Power
  • Power of Appointment
  • Donor
  • Donee
  • Appointive Property
  • Appointees
  • Takers in Default of Appointment
• Purpose of Powers of Appointment
• Types of Powers
  • By scope
    • General
    • Limited
  • By time of exercise
    • Presently exercisable
    • Testamentary
• Creating a power of appointment
  • What if a power of appointment doesn’t name takers in default?
• Exercise
  • Exercise by Will
  • Exercise by Lifetime Instrument
    • Does exercise by lifetime instrument take the property out of a trust and make it an outright gift?
  • Creation of Further Power of Appointment
    • Donee Can Appoint and Create Further Power of Appointment
    • Tax Consequences
      • Does an appointing and giving a further power to appoint avoid having a completed gift?
    • Sample form exercising and creating further power of appointment
  • Exercise in Further Trust
  • Revocable Exercise
  • If two grantors:
    • Surviving grantor cannot unilaterally exercise limited power of appointment requiring joint consent
    • What if the LPOA says that it can be exercised by one of the grantors unilaterally?
    • What if each co-grantor reserves the right to appoint 1/2 of the trust assets?
• Lapse
• Creditors
• Rule Against Perpetuities
• Release/Disclaimer
• Contracts to Appoint
• Selective Allocation
• Tax Consequences

Rule Against Perpetuities

Trusts: Beneficiary

• Naming spouse as beneficiary results in grantor trust

Trusts: Discretionary Trust

• Trustee of discretionary trust has special power of appointment

Trusts: Grantor can retain power to reacquire and substitute trust assets

• Grantor’s retained power to reacquire and substitute assets – uses
• Grantor’s retained power to reacquire and substitute assets results in a grantor trust
• Grantor’s retained power to reacquire and substitute assets – no estate tax if equivalent value
• In QPRT, grantor cannot retain power to reacquire and substitute assets

Trusts: Grantor Trust

• Grantor’s retained power to reacquire and substitute assets results in a grantor trust
• Naming spouse as beneficiary results in grantor trust

Trusts: Revocable

• Formation
  • Guardian can create trust
• NY: Revocable trust can be revoked or amended by will
• Trustee
  • Guardian can probably name co-trustee of revocable trust

Trusts: Irrevocable

• Formation
  • Guardian can create trust
• NY: Trusts are irrevocable by default
• Ways to modify an irrevocable trust
• Ways to add flexibility to an irrevocable trust

Trusts: Medicaid Qualifying Trust (MQT)

• A Medicaid Qualified Trust has many names
• Uses
  • Is a Medicaid qualifying trust a good asset protection tool against creditors other than Medicaid?
  • To protect from Medicaid, transfer to MQT must be before look back period
• Grantor
  • Grantor cannot retain any interest in the trust’s principal
  • Grantor can retain certain powers and interests
    • Grantor can retain right to income
    • Right to reside in principal residence
    • Limited power of appointment
    • Right to remove or replace the trustee
    • Right to reacquire and substitute the trust’s assets
  • More than one grantor
  • Can the grantor (or the grantor’s spouse) be a trustee?
• Res
• Trustee
• Trust protector
• Trust fund
  • Income
    • Grantor can retain right to income
  • Principal
    • Spouse as beneficiary
    • Trustee’s discretion
    • Should a MQT have a reimbursement clause?

Trusts: Qualified Personal Residence Trust (QPRT)

• In QPRT, grantor cannot retain power to reacquire and substitute assets

Trusts: Taxation of Income by States

• When do states tax the income of trusts?

Trusts: Trust Protector

Trusts: Trustee

Trusts: Trustee-Beneficiary

• Merger
  • Merger: Common law prohibited sole trustee from being a beneficiary

Uniform Probate Code

Uniform Trust Code

Wills

• Execution
  • Guardian cannot execute will