Do You Own Cryptocurrency? Update Your Estate Plan!

Rachel A. Quinley

By Rachel A. Quinley



cryptocurrencyCryptocurrency is a hot topic for business owners and individuals alike. But have you considered the importance of updating your estate plan to include your cryptocurrency? If not, read If You Own Cryptocurrency, It’s Time to Update Your Estate Plan! where I discuss the importance of updating your estate plan if you own any cryptocurrency or other digital assets.

Cryptocurrency and other digital assets were not considered in many older estate plans. And with the increase in the number of business owners and individuals acquiring cryptocurrency and other digital assets, estate planning is crucial. Your estate plan documents need to include language that covers your digital assets, just as it covers your more traditional assets. Continue reading »

Asset Protection and Estate Planning Perspective on the Importance of Holding Investment Properties in an LLC

Rachel A. Quinley

By Rachel A. Quinley



llcMost small business owners today are aware of the importance of forming a legal entity before beginning their business operations. However, more individuals and families are turning to rental properties as an investment strategy, and they do not necessarily think of themselves as small business owners. But that is exactly what they are. It is critical to ensure that if you or your family own rental or other investment properties, you protect your personal assets from liability by setting up a legal entity to be the owner of the properties.

The best option for most of these types of small businesses is to form a Limited Liability Company (LLC). Limited Liability Companies require less formality than corporations and are generally less costly to form. They also offer the benefit of pass-through taxation. Though liability insurance offers protection, the one-time cost of setting up an LLC is typically less than the cost of an umbrella insurance policy over time. However, there are still coverage limits with an umbrella insurance policy: If the rental property is owned in your individual name and your liability exceeds the coverage limits, your personal assets could be at stake. LLCs shield their members from personal liability when formed and operated properly.

If you are going to own multiple properties, it may be wise to form a different LLC for each property to shield each property from the liabilities of the other properties. You will want to consult with an experienced attorney to make certain that you are following the correct procedures in establishing your LLC, such as registering the LLC with the Secretary of State, creating an operating agreement, and obtaining a tax ID number for the business.

As you can see, LLCs are extremely useful as a means of asset protection. They are also a great tool for estate planning purposes. Continue reading »

Small Business Owners: Misconceptions About Estate Planning

Rachel A. Quinley

By Rachel A. Quinley



estate planningIn “Estate Planning Misconceptions of Small Business Owners” on our estate planning blog, I recently discussed the most common misconceptions that small business owners have about estate planning.

These misconceptions involve: wills; trusts and trust funding; asset distribution to heirs and beneficiaries; protection for yourself and your assets while you are living and after your death; probate; and succession planning for your business.

Read the full article here: Estate Planning Misconceptions of Small Business Owners.

If you have any questions regarding estate planning as a small business owner, contact me or one of our other estate planning attorneys at 314.726.1000.

Posted by Attorney Rachel A. Quinley. Quinley is an estate planning and probate attorney who focuses her practice on the creation and administration of trusts and estates, wills, beneficiary deeds, financial and medical powers of attorney, guardianships, and other matters related to estate planning. 

Inherited IRAs – Once Protected – Now Possibly Fair Game for Creditors

A. Thomas DeWoskin

By A. Thomas DeWoskin



You should read this article if  –

  1. You expect to transfer funds to your descendants through an individual retirement account (IRA); or
  2. You have inherited an IRA from a relative.

The U.S. Supreme Court has ruled in Clark v. Rameker that the money in an inherited IRA does not qualify for the protection from creditors as provided in the Federal Bankruptcy Code.[1]

The Court concluded that funds in an IRA which was inherited from someone else are not really retirement funds.  It gave three reasons for this conclusion.  The holder of an inherited IRA:

  1. Can never invest additional money into the account.
  2. Is required to withdraw money from the account, no matter how far away retirement may be.
  3. May withdraw the entire balance of the account at any time – and use it for any purpose – without penalty. Continue reading »

Inherited IRAs Not Protected in Bankruptcy

Corporate Law Practice Group

By Corporate Law Practice Group



If you directly inherited an IRA and are facing bankruptcy, these funds are no longer protected from creditors.

In Clark v. Rameker (In re Clark), No. 13-299, the U.S. Supreme Court unanimously ruled that inherited IRAs do not qualify under the “retirement funds” bankruptcy exemption. As a result, non-spouses inheriting an IRA may no longer protect the funds from creditors after filing bankruptcy and spouses have more incentive to “roll over” inherited IRA funds.

Before the Supreme Court decided Clark, there was a split between the 5th and 7th Circuit Courts of Appeals regarding exactly what the “retirement funds” bankruptcy exemption covered. In Chilton v. Moser, the 5th Circuit previously held that inherited IRAs were exempt from the bankruptcy estate because the “retirement funds” exemption never stated that the retirement funds had to be the debtor’s. In Clark v. Rameker, the 7th Circuit disagreed and held that inherited IRAs were not exempt because they were an “opportunity for current consumption, not a fund of retirement savings.” The disagreement stemmed from the interpretation of what “retirement funds” included. Continue reading »

All Married Couples in Missouri Filing Joint Federal Returns Must Also File Joint State Returns

Estate Planning Practice Group

By Estate Planning Practice Group



Married couples in Missouri who file joint federal tax returns, including those not recognized as married by the state but recognized as married in other states, must also now file jointly in the state of Missouri.

Governor Jay Nixon issued the executed order clarifying that, under Missouri law, couples filing joint federal income tax returns must also file joint state returns.

Click here to read more.

Lack of Guidance Leaves Married Gay Couples in Uncertain Tax Position

Corporate Law Practice Group

By Corporate Law Practice Group



Almost every expert out there is weighing in on the legal implications of last month’s Supreme Court decision striking down the Defense of Marriage Act (DOMA). Unfortunately, the IRS has not issued guidance regarding how married couples treat income in states that do not recognize their marriage, whether the IRS will allow income tax returns to be amended for the previous three years, or whether the IRS will allow married couples to file as married in states that do not recognize the marriage.

While IRS guidance is likely on the way, affected couples may have to sort through a confusing minefield of regulations for some time yet.

For more information, contact a qualified tax advisor, and go to “For some gays in America, a legal victory becomes a tax headache.”

 

New Family and Medical Leave Act Guidance for Families of Adult Children with Disabilities

Estate Planning Practice Group

By Estate Planning Practice Group



Families now have clarification on when parents may use leave to care for an adult child with a mental or physical disability.

On January 14, 2013, the Wage and Hour Division of the Department of Labor issued additional guidance to help employers determine eligibility of employees to take leave under the Family and Medical Leave Act (FMLA) when the employee has an adult child with a mental or physical disability incapable of self-care due to a serious health condition.

Generally,  entitlement to FMLA leave ends when a child is 18 years old. “Incapable of self-care” means that the individual requires active assistance or supervision to provide daily self-care in three or more of the “activities of daily living” or “instrumental activities of daily living.” Continue reading »

Financial Exploitation of the Elderly and Disabled Crime Modified to Include Undue Influence

Estate Planning Practice Group

By Estate Planning Practice Group



Senior citizens and the disabled in Missouri will soon have additional protection from financial exploitation.

On July 11, 2012, Missouri SB 689 was signed by Governor Jay Nixon. SB 689 modifies the crime of financial exploitation of the elderly to include “undue influence.”

“Undue influence” is defined under the bill as:

“… influence by a person who has authority over the elderly or disabled person in order to take unfair advantage of the person’s vulnerable state of mind, neediness, pain, or agony. It includes improper use of various types of fiduciary authority.”

Under the bill, the Department of Social Services may now release the income and asset information of an individual in a licensed nursing home facility to the prosecuting attorney for purposes of investigation or prosecution of financial exploitation.

Continue reading »

Survivor Benefits for Unborn Children: Supreme Court Ruling Sides With State Law

Estate Planning Practice Group

By Estate Planning Practice Group



The Supreme Court ruled on May 21, 2012 in Astrue v. Capato that twins conceived through in vitro fertilization after the death of their father were not eligible for survivor’s benefits through the Social Security Administration, upholding the Social Security Administration’s previous determination. According to the Court’s opinion, Mr. Capato lived in Florida at the time of his death. Under Florida law, the children do not qualify for inheritance through intestate succession (the children are not considered heirs of their father’s estate) and are ineligible to receive survivor benefits.

Florida law requires that in order for children to qualify for an inheritance, they must be born or conceived prior to the death of the parent. Because the Capato children were born 18 months after the death of their father, they were not considered to be his children for inheritance purposes under the law. Consequently, the Social Security Administration determined that the children were not eligible for survivorship benefits.

Unlike Florida, Missouri statute provides that all posthumous children (children born after the death of a parent) inherit as if they were born during the lifetime of the deceased parent, as do grandchildren and further descendants. However, other heirs, such as siblings or cousins, must be born and capable to take their share, prior to the death of the deceased.

Continue reading »

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