Estate of Denial:  “As U.S. Senate leaders try to wrap up the debate over governmental control of health care, some dangerous characters are lurking in the wings.  Grave robbers, property poachers, walker stalkers and other opportunists seeking to loot estates are likely applauding this move. Disgruntled family members, wannabe heirs or unscrupulous members of the legal industry will find Obamacare helpful with Involuntary Redistribution of Assets (IRA) actions in which probate venues or instruments like wills, trusts, guardianships and powers of attorney are used to divert assets from intended heirs or beneficiaries.”

Question:  I am an Arizona resident in the process of getting a divorce.  If I form an Arizona limited liability company before my divorce is final, will my wife own a community property interest in my interest in the new LLC?

Answer:  It depends.  How's that for a lawyer answer.  Arizona Revised Statues Section 25-211.A defines community property.  It states:

25-211. Property acquired during marriage as community property; exceptions; effect of service of a petition.

A.   All property acquired by either husband or wife during the marriage is the community property of the husband and wife except for property that is:

1. Acquired by gift, devise or descent.

2. Acquired after service of a petition for dissolution of marriage, legal separation or annulment if the petition results in a decree of dissolution of marriage, legal separation or annulment.

Arizona Revised Statues Section 25-213 defines separate property.  It states:

25-213. Separate property

A. A spouse's real and personal property that is owned by that spouse before marriage and that is acquired by that spouse during the marriage by gift, devise or descent, and the increase, rents, issues and profits of that property, is the separate property of that spouse.

B. Property that is acquired by a spouse after service of a petition for dissolution of marriage, legal separation or annulment is also the separate property of that spouse if the petition results in a decree of dissolution of marriage, legal separation or annulment.

Section 25-211 states the general rule and subsections 1 and […]

Tax Girl:  “Taxpayer asks:  Can you tell me what the tax implications are for donating inherited items? My mother passed away about a year ago and I’m the executor of the estate. Now, my siblings are interested in taking deductions for items they feel they “inherited,” yet were actually immediately donated to charity without my siblings ever having taken actual possession of the items. Is this legal? No documentation exists showing a transfer of the property to the beneficiaries so it could be argued that the items were actually donated by the Estate.  Taxgirl says:  I can’t tell you how many times this comes up in an estate

Wealth Strategies Journal:  “One common issue facing those who create trusts is how to protect beneficiaries from creditors. One of the biggest, baddest creditors out there is the Internal Revenue Service (IRS or Service), wielding two weapons of mass collection: the federal tax lien and the federal tax levy. These weapons regularly pierce boilerplate spendthrift provisions. Discretionary trusts do not fare much better. Court decisions over the past ten years make it increasingly likely that even pure discretionary trusts contain clauses that traitorously turn over the treasure house keys to the federal tax lien. Once the lien attaches, the IRS can enforce it through either administrative or judicial attachments, blowing through state law barriers that keep out other creditors.”

This Article offers some ideas on how to keep the federal tax lien locked out from trust assets using property law concepts of springing and shifting executory interests. This Article posits that a properly drafted tax lien lockout provision can deflect the federal tax lien.

This is a three part article.  See Part 1, Part 2 and Part 3.

Yakima Herald:  “Eric Gustafson has seen it too many times.  Families estranged or survivors forced to spend large sums of money in the absence of an estate plan or — just as importantly — a plan that hasn't been updated to account for changed circumstances such as divorces or deaths.  Such plans should include a durable power of attorney for health care and finances, a will, a community property agreement for a couple and, in some cases, a revocable trust.”

Wall St. Journal:  “Videos offer a chance for the dying to offer some final thoughts—as well as head off legal disputes.   Some individuals have found a way to breathe life into dry estate-planning documents:  They're supplementing them with personal messages via video.”

The age.com.au:  “TWO penniless brothers who live in a cave outside Budapest are to inherit most of a reported $A7.2 billion after an astonishing twist in their family fortunes.  Zsolt and Geza Peladi have no fixed address and eke out an existence by selling junk they find in the street.  But their scavenging days are about to be over. The brothers have been told they are entitled to their long-lost grandmother's fortune, along with a sister who lives in America.  Charity workers in Hungary broke the news to them after being contacted by lawyers handling the estate of their maternal grandmother who died in Baden-Wurttemberg, Germany.”