Book Review: Special Needs Trust Administration Manual: A Guide for Trustees

Special Needs Trust Administration Manual: A Guide for Trustees, written by Barbara Jackins, with contributors Richard Blank, Peter Macy, Ken Shulman, and Harriet Onello, covers everything a trustee of a special needs trust needs to know in administering a special needs trust.

It is crucial that a trustee, especially if it is a family member of a special needs individual, understands how to spend special needs trust funds appropriately so that a special needs individual's government benefits are not harmed. It is also important for the trustee to report to government agencies how special needs trust funds were spent. This guide for trustees can be helpful in preventing mistakes that could cost a special needs individual dearly.

You can review the book here.

Switt Family Will Not Inherit Gold Coins

An update on a blog I wrote a few days ago regarding Israel Switt, Israel Switt's heirs, and a lawsuit against the government to inherit gold coins.

A jury decided against Israel Switt's heirs. Gold coins discovered in a safety deposit box by his daughter, Joan Langord, were turned over to the government for authentication. It was determined the gold coins were authentic double eagles gold coins that were minted and then melted back into gold bars at the direction of Franklin Delano Roosevelt. The coins were never sold to the public. Ms. Langord sued the government claiming her family were heirs to the gold coins. The government's lawyers convinced the jury that Mr. Switt underhandedly obtained the gold coins from a cashier inside the U.S. Mint thus making the property stolen property rather than an inheritance for Mr. Switt's heirs.

Read here for more information on the matter.

Take a look at our site here regarding inheritance matters.

Inheriting Double Eagle Gold Coins Might Not Be Easy

Israel Switt, a Philadelphia jeweler, died in 1990. In 2003, Switt's daughter, Joan Langbord, discovered ten gold coins in a safety deposit box owned by her father. She is now suing the U.S. Government for the right to inherit those gold coins.

The gold coins in question are called double eagles. In 1933, Franklin Delano Roosevelt ordered all double eagle gold coins to be melted back into gold bars. The double eagles were never released by the U.S. Government. But a few of these gold coins mysteriously got out.

Ms. Langbord insists the government has the burden of proof in this case. This could mean that if the government cannot prove Israel Switt personally stole the double eagles, the gold coins would pass to Israel Switt's heirs. And Israel Switt's heirs could inherit coins that are worth millions of dollars.

A few articles of interst regarding Mr. Switt's double eagle gold coins are:

"Heirs Battle U.S. Mint Over Prized Gold Coins" by the Wall Street Journal
"Family fights government over rare 'Double Eagle' gold coin" by Yahoo
"Pa. family fights US over rare 1933 gold coins" by Associated Press

For more information regarding inheritance issues look here.

The Connecticut state attorney general stepped into a probate proceeding to challenge the sales agreement stemming from 2005 that challenged the legitimacy of a sales agreement in which an elderly Greenwich woman agreed to sell her home to two men for less than half of what it was worth at the time.

Attorney General Richard Blumenthal intervened after Mona Lee Johnson, of Greenwich, agreed to sell her home, estimated to be worth $1.2 million, for $500,000, a month before she passed away.

The Attorney General's Office alleged that her neighbor, Mark Lovallo, had urged Johnson to sign off on the sales option while she was sick in the hospital. The deal also included her longtime accountant, David Alfano.

Blumenthal said that Johnson never intended to approve the deal, which would have significantly lowered the amount of money that would have been donated to eight of her favorite charities. Johnson's will divided nearly all of her $1.5 million estate to charities including the Greenwich Library and Perrot Memorial Library in Old Greenwich.

"I fought successfully to stop this suspect agreement denying hundreds of thousands of dollars to charities intended to benefit from the home's sale," said Blumenthal. "In charity law, the donor's wishes are paramount. This donor never wished to sell her home at a bargain-basement price, significantly slashing the proceeds to charities named in her will."

Blumenthal said the "suspect" agreement caught his attention because his office is in charge of enforcing charity laws and often reviews probate cases involving charitable donations.

"We were the only ones to challenge this agreement. It came to our attention through filings in the probate court," said Blumenthal.

If the sales agreement had gone through and Johnson's home was sold for $500,000, Blumenthal said the estate's total value would have been about $300,000 less.

"Ill and infirm, this woman supposedly signed papers while hospitalized and in the last month of her life, raising grave doubt the agreement reflected her true wishes," said Blumenthal.

Probate Judge Daniel Caruso voided the agreement earlier this month. The house will now be offered to Lovallo and Alfano for one month at the original fair market price at $1.2 million. Blumenthal said if they fail to act on the deal, the executor of the estate will put it on the market to be sold for at least $800,000 or more.

Johnson's estate also includes $700,000 in stocks and cash.

After expenses, all but $100,000 of the estate will be divided among eight charities including, Weimaraner Foundation, AKC Canine Health Foundation, Perrot Memorial Library, Greenwich Library, Cornell University Veterinarian School, University of Pennsylvania Veterinarian School, Tufts Veterinarian School and the Embroiders Guild.

Calls to Lovallo and Alfano Friday were not immediately returned.

See article here.
For information regarding estate planning look at our website here.

Somebody's gotta pay for this thing

Funding Health Care. Tax the rich, tax passive income, make big pharma pay, soda pop tax, make "non-profit" hospitals chip in more. These are the options currently on the table:

* Expanding the 1.45% Medicare payroll tax on earned income to "passive income," or unearned income, which could raise $100 billion;

* A 5% surtax on individuals who earn more than $500,000 and couples who earn more than $1 million;

* A tax on employer-sponsored health benefits at a level higher than previously considered, with one proposal to tax plans worth more than $20,300 for a family and $8,300 for an individual. The proposal could raise $240 billion. Another option would be to increase the cutoff to plans worth more than $25,000, which could raise $90 billion;

* Capping the tax break on itemized deductions at 28%, which could raise $168 billion, or a freeze on the top deduction rate at 35%, which could raise $90 billion;

* Issuing tax credit bonds to pay for the proposed Medicaid expansion, which could generate $75 billion in new revenue;

* Charging fees to pharmaceutical companies and insurers, which could generate up to $20 billion and $75 billion, respectively;

* Raising taxes on sugary drinks. A three-cent tax increase would generate $30 billion, while a 10-cent tax increase could result in $100 billion in new revenue (Budoff Brown/Rogers, Politico, 7/9); and

* Requiring that not-for-profit hospitals provide a minimum amount of charity care, which would both increase the amount of care provided that the federal government does not fund and force those hospitals not providing enough no-cost care out of tax-exempt status (Martinez, Wall Street Journal, 7/10);

Unintended Consequences

The Metro train car that slammed into another on the Red Line killing 9 and injuring 76, was two months past due for scheduled maintenance on its brakes, and the car was an older model that federal officials had recommended be replaced because of concerns about its safety in a crash, according to the Washington Post.

From Concurring Opinions, via Taxprof, Taxes incentives may be a cause of the crash. Taxes not only raise revenue they influence behavior, intentionally or not so much.

Here the Metro authorities knew that the aging trains posed safety concerns, one reason they weren't so quick to ask, according to Prof. Sarah Lawsky is they were received money for keeping them.

The Metro Transit Authority sold equipment, including train cars, to another party then leases it back. The other party gets various tax advantages associated with owning the equipment that the Metro as a tax-exempt organization can't take advantage of. In return the company gives a cut of those tax savings back in cash to the Metro.

IRS Ruling on Non Profits and Political Activism

The IRS ruled that the Niemoller Foundation funded by financial backers of Texax Gov. Rick Perry did not risk losing their tax-exempt status for engaging in political acts on behalf of issues such as traditional-values advocacy.

The Texas Freedom Network filed a complaint saying that the Niemoller Foundation brought together pastors and politicians to champion moral issues during Republican Gov. Rick Perry's 2006 re-election campaign.

Short of endorsing a particular candidate or spending substantial portions of their nonprofit budgets on legislative lobbying, ministers and their churches are free to engage in political acts on behalf of moral values, the IRS said.

From the Washington Times.

Connecticut Officials Choosing Corrupt Outdated Probate System over Reform

Apparently the much needed probate reform in Connecticut has stalled.

From Rick Green Only in Connecticut

Hartford lawyer Peter Costas had this to say in a commentary in today's Courant:

The present system is the last bastion of patronage and cronyism in Connecticut. Probate judges can appoint their friends and supporters as guardians, conservators, etc. Probate judges can provide campaign contributions to legislators in the hopes that they will support their position. As a result, legislators may block efforts to reform, if not abolish, the probate court.

There are 117 probate courthouses - about one for every 30,000 residents in the state. The reformers, which includes the governor, want any contested conservatorship moved to the Superior Court where the judges have to be qualified, unlike probate judge appointees. The Connecticut courts have imposed conservatorships in at least three cases that were outrageous and sparked this latest push for reform.

Track your refund at IRS.gov

Where's my refund?

End-of-life Matters in Colorado

In Colorado, a new law — formerly known as House Bill 1260 — allows two people to enter into "designated beneficiary agreements" for estate planning, property purchases, medical decisions and certain benefits such as life-insurance and retirement-plan disbursements.

Ritter's, Evan Dreyer, said the governor sees it simply as a "low-cost option for people to put their end-of-life matters in order."

The law allows any two unmarried adults to designate each other as beneficiaries by filing a form with a county clerk.

Denver Post

We want homes, not nursing homes

Tom Harkin D-Iowa, has introduced a bill in the senate Congressman Danny Davis D-Il has introduced in the house, a bill that is written to offer more choice and independence for people with disabilities. The Community Choice Act allows people with disabilities who need an institutional level of care the choice of receiving that care in their own communities, in their own homes, rather than in an institution.

We want real homes, not nursing homes,” said Harkin, one of the authors of the Americans with Disabilities Act. “Our current system effectively forces people into institutions and requires them to impoverish themselves in order to become eligible for the assistance they need.

H/T specialneedsanswers.com

Risk of Audit

According to the Wall St. Journal, you are more likely to run into the taxman if -

- you make a lot of money.

- take the full mortgage-interest deduction on a refinanced mortgage where you've borrowed to take equity out. This is particularly true in higher-priced housing markets.

- have a major change in income - even if it's a decline.

- big business expenses

- numerous gifts to charity

- reported income that doesn't match numbers on 1099 and W-2 forms

- file Schedule C, profit and loss for business

- big write-offs for hobbies.

Heirs try to Re-gain Assets they Stole over 20 Years ago

"Now we've got all of madame's requisites and all in madame's size
Madame's taste is truly exquisite she must accessorize
The belts are alligator the bags are kangaroo
Enchante, may I say, the jade was made for you."

Imelda
written by Mark Knopfler

The heirs of the late president Ferdinand Marcos are taking steps to regain assets seized during a military revolt that toppled his 20-year reign. The family has restored its political clout and are trying to recoup assets that were taken as ill-gotten gains. The Marcos amassed a fortune that was estimated to be from $5 to 10 billion during their years in power.

Imelda Marcos' extravagant lifestyle reportedly included five-million-dollar shopping sprees in New York, Rome and Copenhagen in 1983. They owned a number of properties in Manhattan in the 1980s. Her New York real estate was later seized and sold, along with much of her 20 million jewelry collection and most of her 175 piece art collection, which included works by Michelangelo and Botticelli. She responded to criticisms of her extravagance by claiming that it was her "duty" to be "some kind of light, a star to give [the poor] guidelines."

Imelda, whose lavish lifestyle was widely viewed as contributing to her husband's downfall, sued Presidential Commission on Good Government's officials for graft and fraud. Her complaint is the takeover since 1986, allegedly without proper accounting, of $42.6 million worth of family-owned assets.

PCGG officials however say the assets were not confiscated but rather "surrendered" to them by a self-confessed Marcos crony, businessman Jose Campos, in exchange for immunity from civil and criminal suits. Campos had admitted that he acted as a front for the Marcoses in acquiring the properties.

An Alice in Wonderland Moment

The wayback machine takes us into the looking glass and we find ourselves in the year 1999.










Highlights of the Trip. . .

Congress approved landmark legislation today that opens the door for a new era on Wall Street in which commerciqal banks, securities houses and insurers will find it easier and cheaper to enter one another's business.

''Today Congress voted to update the rules that have governed financial services since the Great Depression and replace them with a system for the 21st century,'' Treasury Secretary Lawrence H. Summers said.

The decision to repeal the Glass-Steagall Act of 1933 provoked dire warnings from a handful of dissenters that the deregulation of Wall Street would someday wreak havoc on the nation's financial system.

Administration officials and many Republicans and Democrats said the measure would save consumers billions of dollars and was necessary to keep up with trends in both domestic and international banking.

''The world changes, and we have to change with it,'' said Senator Phil Gramm of Texas, who wrote the law that will bear his name along with the two other main Republican sponsors, Representative Jim Leach of Iowa and Representative Thomas J. Bliley Jr.

Glass-Steagall, in the midst of the Great Depression, came at a time when the thinking was that the government was the answer. In this era of economic prosperity, we have decided that freedom is the answer.''

The opponents of the measure gloomily predicted that by unshackling banks and enabling them to move more freely into new kinds of financial activities, the new law could lead to an economic crisis down the road when the marketplace is no longer growing briskly.

''I think we will look back in 10 years' time and say we should not have done this but we did because we forgot the lessons of the past, and that that which is true in the 1930's is true in 2010,'' said Senator Byron L. Dorgan, Democrat of North Dakota.

''Glass-Steagall was intended to protect our financial system by insulating commercial banking from other forms of risk. It was one of several stabilizers designed to keep a similar tragedy from recurring. Now Congress is about to repeal that economic stabilizer without putting any comparable safeguard in its place,'' said Senator Paul Wellstone.

If anything, the supporters said, the new law will give financial companies the ability to diversify and therefore reduce their risks. The new law, they said, will also give regulators new tools to supervise shaky institutions.
''The concerns that we will have a meltdown like 1929 are dramatically overblown,'' said Senator Bob Kerrey, Democrat of Nebraska.

H/T Boing Boing
Original Article here.

RIP Donald Alexander - IRS commissioner in the -70s

Donald Alexander IRS commissioner from 1973 to 1977 died Tuesday of cancer. Alexander served when the agency came under severe public scrutiny for its earlier role in investigating political opponents and radicals on the far right and left. A prominent tax lawyer when he took the IRS job, he learned the day after his swearing-in of a secret band of IRS investigators who combed through the tax returns of 3,000 "notorious" groups and 8,000 individuals.

Within three months, he ordered the unit disbanded, saying that political views "extremist or otherwise, are irrelevant to taxation," he wrote in a 1999 editorial for the publication Tax Notes. "The evening of the same day, President Nixon made his first effort to fire me."

Alexander alerted then Treasury Secretary George Shultz in the early 1970s that Nixon's name came up for an audit under the agency's randomized process. The president was reported by Al Haig to be "up the wall over this -- the IRS never audits a president."

Alexander proved that many previous presidents had been audited, and the Nixon audit went forward. It turned up a number of irregularities, which were leaked to the press and led to a special prosecutor's investigation. In the end, it was determined that the president owed more than $400,000 in back taxes and penalties. Whole story at the LA Times.

The Iranian government has begun implementing controversial legislation that allows women to inherit all forms of their husband's property.

President Mahmoud Ahmadinejad has issued a decree that instructs all government bodies to enforce a recently passed law, modifying women's inheritance rights, Iranian newspapers reported on Wednesday.

On January 25, the Iranian parliament passed legislation making it possible for women to inherit up to a quarter of the land and standing property that their husbands owned while alive.

The previous law only allowed women to inherit a portion of portable property and those non-portables that were standing, such as buildings, trees and such. However, the new legislation has added ground assets, such as land, to that list.

The president ordered the legislation to be implemented, in spite of the Guardian Council's silence over the issue.

According to Iranian law, the Guardian Council, made up of six religious and six legal experts, must approve all parliamentary legislations before they can become law.

However, if the Council decides to not take any official stance on any legislation in a set period of time, the legislation becomes official automatically, as in the case of the new legislation on women's inheritance rights.

The Guardian Council's decision to remain silent on the issue follows heavy criticism from several top religious figures, who view the legislation as in clear contradiction with the Islamic law.

Commenting on the criticism, the country's Parliament Speaker Ali Larijani said that the parliament passed the law after receiving approval from the Leader of the Islamic Revolution, Ayatollah Seyyed Ali Khamenei.

"The Guardian Council asked the Leader for a Fatwa [religious ruling] on the matter and the parliament passed the Leader's exact Fatwa," Larijani explained.

In defense of the decision, Iranian journalist and legal expert Majid Dehlavi says the implementation of the new inheritance law is 'a step in the right direction.'

"This new law is far more in harmony with the social system governing our relations," Dehlavi told Press TV on Thursday.

"The previous law was used in the past to safeguard the property of the children after their mothers remarried, but that has nothing to do with the society we live in today," he added.

Rick Green - Connecticut's Caped Cusader

CT Confidential

Margot Claus, owes the court who wrongfully imprisoned her almost $1,000 according to Rick Green at the Hartfort Courant. The woman who was not a resident of Connecticut got tied up in the state probate system and had to be rescued German relatives.

Women's Cases Cry Out For Probate Reform from Rick Green at The Hartford Courant


There have been allegations of incompetence, corruption, and bribery that Green reports allows all kinds of people to make money off an old or ill person's estate. His probate blog posts are here.

Connecticut has a 300 year-old probate bureaucracy that runs 117 different courthouses and 117 judges. It does not allow jury trials and judges do not have to have training in the law. Courant columnist Rick Green has followed closely the stories of people caught up in the system and unfairly stripped of their rights. This reporting has finally paid off this year as Connecticut's Governor has introduced probate reform that will require probate judges to be members of the bar and consolidate the 117 courts into 36 courts corresponding to the boundaries of state senatorial districts.

More Audits Likely

Santa Rosa Press Democrat reports that with the increase in the estate-tax exemption raising to $3.5 million this year, there will be fewer returns, but there more likely will be more audits and that the IRS has hired more estate and gift-tax auditors.

More audits will take place, in part at least, because of lost revenue due to the increase in exemption.

Burris' Posthumous Pad

He's One of Us, Part 2

Since Roland Burris' appointment to Illinois’ vacant U.S. Senate seat, there's been talk around the web about the monument to himself.

On Thursday, Burris explained to reporters that his tombstone is already prepared because “I am a probate attorney.”

“If I’m going to try to counsel people on preparing to leave this earth, and counsel them correctly, I have to also have to mine already prepared,” he added.

Burris was appointed by Blagojevich to fill the Senate seat vacated by President-elect Barack Obama. He still faces legal challenges before he can go to Washington.