Q: My husband of 20 years past away. His estate is going through probate now. Can his ex-wife be entitled to something? She now claims that she owns all the assets in his IRAs and 401K, totaling $2,000,000. Is this LEGAL?
A: Yes. Many people do simple wills before their death and do not seek advice of professional Estate Planning attorney. As a result, they forget about such important assets in their estate as IRAs, 401K(s) and other retirement accounts.
Independent of your intentions, such as seeing the assets distributed to your wife and children, custodians of retirement accounts must follow the directions of the beneficiary designation form - even if that means that $2 million of the assets legally go to an ex-wife from 20 years ago.
Q: What should I do to make sure correct beneficiaries inherit all of my estate?
A: Consult with an Estate planning attorney prior to divorce, marriage, birth of a child and other important life changing event. Many divorce attorneys do not draft separation or divorce documents properly often forgetting about very important assets that by law belong to your current spouse. Such assets are your IRAs, 401(k)s, pension plan accounts and others. If you designate someone other than your spouse to inherit such assets, you need your spouse's permission! If you get divorced from that spouse, you must properly remove such spouse from those assets.
Most important advice any good attorney can give you - review your estate plan including your beneficiary designations annually and during important changes in your life. And for once, let the professional handle your estate planning needs!
Monday, July 26, 2010
An Inheritance Shocker - Retirement Account Beneficiaries
Do you want your spouse to inherit the money in your 401(k) — or do you want your former spouse to get it? If you are divorced, remarried or have children from a previous relationship, make sure you have updated the beneficiary designation for your retirement plan at work. Otherwise, your spouse or kids could be in for a shock.
A shock is exactly what William Kennedy gave his daughter, Kari. The elder Kennedy married Kari’s mom in 1974 while working for DuPont. He named his wife as the beneficiary of his 401(k), and with no children at the time, he left blank the contingent beneficiary (who would get the money if the wife died first).
When the couple divorced in 1994, his ex-wife agreed to relinquish any rights to the money in the plan so that Kari would receive the money. But William did not sign new papers at work to officially change his beneficiary designation. So when he died in 2001, DuPont gave his ex-wife the proceeds — $400,000.
Kari sued DuPont, arguing that it violated the divorce decree by giving the money to her mother. The case made it all the way to the Supreme Court, which recently ruled in favor of DuPont. The majority ruled that DuPont acted in accordance with ERISA, the law governing retirement plans, which stipulates that beneficiary designations trump all other agreements.
The lesson: It’s not enough to sign a contract or write a will. If you want someone to be the heir of your retirement plan at work, you must stipulate your instructions in the trust documents. Have you done your Estate Planning lately? Have you reviewed your beneficiary designations lately to make sure that the people you want to get your money are really the people who will get your money? If you haven’t done so recently, go to your attorney and do your Estate Planning properly.
Footnote: The court noted that Kari could sue her mother based on the divorce agreement, but that won’t do her any good. She told her hometown newspaper The Enterprise that her mother died in 2007 after moving to Norway and spending all the money.
A shock is exactly what William Kennedy gave his daughter, Kari. The elder Kennedy married Kari’s mom in 1974 while working for DuPont. He named his wife as the beneficiary of his 401(k), and with no children at the time, he left blank the contingent beneficiary (who would get the money if the wife died first).
When the couple divorced in 1994, his ex-wife agreed to relinquish any rights to the money in the plan so that Kari would receive the money. But William did not sign new papers at work to officially change his beneficiary designation. So when he died in 2001, DuPont gave his ex-wife the proceeds — $400,000.
Kari sued DuPont, arguing that it violated the divorce decree by giving the money to her mother. The case made it all the way to the Supreme Court, which recently ruled in favor of DuPont. The majority ruled that DuPont acted in accordance with ERISA, the law governing retirement plans, which stipulates that beneficiary designations trump all other agreements.
The lesson: It’s not enough to sign a contract or write a will. If you want someone to be the heir of your retirement plan at work, you must stipulate your instructions in the trust documents. Have you done your Estate Planning lately? Have you reviewed your beneficiary designations lately to make sure that the people you want to get your money are really the people who will get your money? If you haven’t done so recently, go to your attorney and do your Estate Planning properly.
Footnote: The court noted that Kari could sue her mother based on the divorce agreement, but that won’t do her any good. She told her hometown newspaper The Enterprise that her mother died in 2007 after moving to Norway and spending all the money.
Monday, June 21, 2010
Gifted and Talented Programs in NYC 2010 - Increase in High-Scoring Students
The number of students qualifying for gifted kindergarten programs in New York City public school districts rose by 10 percent this year, and those qualifying for the elite citywide program jumped by a third, raising the possibility that parents and their children have begun to master an admission process that was retooled three years ago.
According to figures released Friday by the Department of Education, the spike in students eligible for gifted programs occurred despite a 16 percent drop in the number who took the exams. The city described the decrease as a “leveling off” after an increase in test-takers last year, which they attributed to a publicity campaign.
Of the 12,454 in New York City who took the test this winter, 3,542 (or 26 percent) scored at or above the national 90th percentile, up from 3,231 the year before, qualifying them for one of the 70 gifted kindergarten programs spread through the city’s school districts. But the most striking increase occurred in the number of children scoring at or above the national 97th percentile: 1,788, up from 1,345 last year. Those students qualify for one of the five citywide gifted programs, which have only about 300 seats in all, meaning the competition for them this year will be even fiercer.
Already, the bar for admission to at least one of the citywide programs, the Anderson School on the Upper West Side, has been raised to the 99th percentile for most of its 50 seats. Almost 300 parents whose children scored that high attended recent daytime tours.
Anna Lewiston of the Upper East Side was determined to send her daughter, Lena, to Anderson but was told that the girl’s 97th-percentile score would not make the cut. Lena will go to a private school. “It’s really too much pressure for preschoolers,” Ms. Lewiston said of the test.
Another citywide program, the Brooklyn School of Inquiry in Gravesend, allowed 540 parents on tours before turning others away. The principal, Donna Taylor, said she noticed growing anxiety among them when they saw the odds of getting one of her 56 slots.
“It’s heartbreaking,” she said. Children who are not selected for citywide programs are eligible for district-based gifted programs; students may also enroll in regular kindergarten classes at their neighborhood schools.
The cause of the higher passing rates was not clear, but increased preparation might have been a factor. Hundreds of parents hired tutors or bought commercial test preparation materials before taking this year’s test, a mixture of the Otis-Lennon School Ability Test, a reasoning exam, and the Bracken School Readiness Assessment.
At the Perry School, a preschool in the West Village, children spent an hour a day in a “think tank program” designed to expose them to the reasoning and materials they would see during the test. They also had professional tutoring. Of the five students who took the gifted exam, “we got two 99s, a 98, and two 97s,” said Dawn Ifrah, the founder.
Bright Kids NYC, the tutoring company that worked with those children, reported that 80 percent of the 120 children for whom it had results had scored over the 90th percentile, and 60 children had scored in the 99th.
Department of Education officials acknowledged that preparation may have played a role but said they were confident that most children who passed belonged in accelerated classes. They added that the city was trying to increase the number of full-day preschools in poor, black and Hispanic neighborhoods, which are underrepresented in the gifted programs.
Anna Commitante, who heads the gifted and talented program, said the city “may very well think about something different” after next year, when its contract with testing companies expires. But officials later said no policy change was under consideration.
Susan K. Johnsen, the president of the Association for the Gifted, a division of the Council for Exceptional Children, recommends the use of many measures to assess giftedness, like observation, recommendations and student work, not simply tests. “Any test is susceptible to test preparation, and that’s why you start to invalidate those assessments,” Dr. Johnsen said.
The increase in high-scoring students was concentrated in the middle- and upper-middle-class districts of Manhattan and Queens. In the Bronx, fewer students qualified this year.
In District 3, which includes the Upper West Side, 455 children, a full 47 percent of those who took the test, scored at or over the 90th percentile, and 250 scored at or over the 97th, compared with 218 last year. In Manhattan’s District 2, 44 percent of the test-takers qualified, and 341 pupils got top scores, a 42 percent increase.
In the past, the city’s 32 school districts used diverse criteria for gifted admission, but the city made the test the sole factor in 2008, in part to address allegations of favoritism and the overrepresentation of white children in the programs. Yet nearly 70 percent of students in the programs are white or Asian, the reverse of the racial composition of the school system as a whole.
According to figures released Friday by the Department of Education, the spike in students eligible for gifted programs occurred despite a 16 percent drop in the number who took the exams. The city described the decrease as a “leveling off” after an increase in test-takers last year, which they attributed to a publicity campaign.
Of the 12,454 in New York City who took the test this winter, 3,542 (or 26 percent) scored at or above the national 90th percentile, up from 3,231 the year before, qualifying them for one of the 70 gifted kindergarten programs spread through the city’s school districts. But the most striking increase occurred in the number of children scoring at or above the national 97th percentile: 1,788, up from 1,345 last year. Those students qualify for one of the five citywide gifted programs, which have only about 300 seats in all, meaning the competition for them this year will be even fiercer.
Already, the bar for admission to at least one of the citywide programs, the Anderson School on the Upper West Side, has been raised to the 99th percentile for most of its 50 seats. Almost 300 parents whose children scored that high attended recent daytime tours.
Anna Lewiston of the Upper East Side was determined to send her daughter, Lena, to Anderson but was told that the girl’s 97th-percentile score would not make the cut. Lena will go to a private school. “It’s really too much pressure for preschoolers,” Ms. Lewiston said of the test.
Another citywide program, the Brooklyn School of Inquiry in Gravesend, allowed 540 parents on tours before turning others away. The principal, Donna Taylor, said she noticed growing anxiety among them when they saw the odds of getting one of her 56 slots.
“It’s heartbreaking,” she said. Children who are not selected for citywide programs are eligible for district-based gifted programs; students may also enroll in regular kindergarten classes at their neighborhood schools.
The cause of the higher passing rates was not clear, but increased preparation might have been a factor. Hundreds of parents hired tutors or bought commercial test preparation materials before taking this year’s test, a mixture of the Otis-Lennon School Ability Test, a reasoning exam, and the Bracken School Readiness Assessment.
At the Perry School, a preschool in the West Village, children spent an hour a day in a “think tank program” designed to expose them to the reasoning and materials they would see during the test. They also had professional tutoring. Of the five students who took the gifted exam, “we got two 99s, a 98, and two 97s,” said Dawn Ifrah, the founder.
Bright Kids NYC, the tutoring company that worked with those children, reported that 80 percent of the 120 children for whom it had results had scored over the 90th percentile, and 60 children had scored in the 99th.
Department of Education officials acknowledged that preparation may have played a role but said they were confident that most children who passed belonged in accelerated classes. They added that the city was trying to increase the number of full-day preschools in poor, black and Hispanic neighborhoods, which are underrepresented in the gifted programs.
Anna Commitante, who heads the gifted and talented program, said the city “may very well think about something different” after next year, when its contract with testing companies expires. But officials later said no policy change was under consideration.
Susan K. Johnsen, the president of the Association for the Gifted, a division of the Council for Exceptional Children, recommends the use of many measures to assess giftedness, like observation, recommendations and student work, not simply tests. “Any test is susceptible to test preparation, and that’s why you start to invalidate those assessments,” Dr. Johnsen said.
The increase in high-scoring students was concentrated in the middle- and upper-middle-class districts of Manhattan and Queens. In the Bronx, fewer students qualified this year.
In District 3, which includes the Upper West Side, 455 children, a full 47 percent of those who took the test, scored at or over the 90th percentile, and 250 scored at or over the 97th, compared with 218 last year. In Manhattan’s District 2, 44 percent of the test-takers qualified, and 341 pupils got top scores, a 42 percent increase.
In the past, the city’s 32 school districts used diverse criteria for gifted admission, but the city made the test the sole factor in 2008, in part to address allegations of favoritism and the overrepresentation of white children in the programs. Yet nearly 70 percent of students in the programs are white or Asian, the reverse of the racial composition of the school system as a whole.
Monday, June 14, 2010
How the New Wealth Taxes Will Hit You
We will soon be paying a lot more taxes. According to the new health-care bill that Congress passed in March, new taxes will have to be paid: an extra .9% tax on wages for couples earning more than $250,000 ($200,000 for singles) and a new 3.8% tax on investment income.
What it means for us, ordinary people is that our earnings will be taxes more. For workers, the extra 0.9% levy puts a progressive element in what used to be a totally flat tax. The 3.8% tax on investment income also knocks down a longstanding wall by applying a "payroll" tax to unearned income. Until now, FICA taxes for Social Security and Medicare have applied only to wages, not investment income.
While many details remain unclear and the Internal Revenue Service hasn't issued any guidance, here are preliminary answers to the most important questions taxpayers are asking.
These taxes take effect in 2013, two elections away. Might they be repealed first?
Not likely. "Congress would have to undo the health reform, and budget constraints would still be there," says Clint Stretch of Deloitte Tax. "Even if Republicans take control of Congress, President Obama holds the veto pen until Jan. 20, 2013."
How does the 0.9% tax work?
If Mark and Victoria each earn $175,000, their total employment income is $350,000. Currently they owe 1.45%—$5,075—of regular Medicare tax, and their employers owe a matching amount. In 2013, the couple will owe an extra 0.9%—$900—on their wages above $250,000, which is $100,000. Their employers pay nothing extra.
What about the 3.8% tax on net investment income?
This levy is keyed to "modified adjusted gross income," with a threshold of $250,000 for couples and $200,000 for singles. (This is simply adjusted gross income for nearly everybody except expatriates, who must add back certain exclusions.) The tax is a flat 3.8% on investment income above the threshold.
How would this work?
Example 1: Mark and Victoria, a married couple, have $400,000 of AGI—$200,000 of wages plus $200,000 of investment income. Because they have $150,000 of investment income above the $250,000 threshold, they would owe an extra $5,700.
Example 2: Anne, a single filer, earns $40,000 but has an investment windfall of $190,000, for total income of $230,000. Because she has investment income of $30,000 above her $200,000 threshold, she would owe $1,140 of additional tax.
Example 3: Retirees Mary and Bill have no wages but they do have a taxable IRA payout of $90,000, plus investment income of $150,000, for a total of $240,000. They don't owe the new tax, because they have no investment income above the $250,000 threshold.
What is investment income?
Interest, except municipal-bond interest; dividends; rents; royalties; and capital gains on the sales of financial instruments like stocks and bonds. The taxable portion of insurance annuity payouts also counts, unless it is from a company pension. So do gains from financial trading, as well as passive income from rents and businesses you don't participate in. All are subject to the 3.8% tax on amounts above the $250,000 or $200,000 threshold, as described above.
Not taxed: Distributions from regular and Roth IRAs and other retirement accounts, including pensions and Social Security, and annuities that are part of a retirement plan. Life-insurance proceeds, muni-bond interest and veterans' benefits don't count, nor does income from a business you participate in, such as a Subchapter S or partnership.
Could the 3.8% tax apply to gains on the sale of a home?
Yes, if there is a taxable gain above the $500,000 ($250,000, single) exclusion for gains on the sale of your residence.
Example: John and Jill, who bought their home in a New York suburb for $50,000 in 1972, sell it in 2013 for $1 million. After subtracting the $50,000 cost and $500,000 exclusion, they have investment income of $450,000. If they also have a taxable IRA payout of $70,000 and a pension of $30,000, they would owe the tax of $11,400 on $300,000.
What happens if a taxpayer who owes the new tax on investments also has a large itemized deduction—say, medical expenses or a theft loss?
Even if taxable income is zero because of deductions, he or she could still owe the 3.8% tax. Example: Myra is a single filer with investment income of $100,000 and wages of $200,000. But during the same year she loses $300,000 in a Ponzi scheme. She pays no income tax, but she still owes the new Medicare tax of $3,800 on her net investment income, says Sharon Kreider, a tax expert in Sunnyvale, Calif.
Does the 3.8% tax affect trusts and estates?
Yes, and it can hit them hard. The tax is levied on investment income as low as $12,000 that isn't paid out to beneficiaries. Some believe the tax may also hit children's unearned income subject to the "kiddie tax" if the parents owe it themselves.
What steps would Law Office of Inna Fershteyn recommend to minimize these taxes, other than taking capital gains before 2013 or buying municipal bonds?
• Examine both your regular and investment income: the higher your regular AGI, the more likely that your investment income will be subject to the new tax. So while Social Security and pensions don't count as investment income, they raise AGI. This makes Roth IRA conversions even more attractive for many. "Roth withdrawals don't raise AGI and aren't investment income," says Vern Hoven, a tax expert in Gig Harbor, Wash.
• Reconsider a defined-benefit pension if you're eligible. Pension payouts don't count as investment income, and the older a taxpayer is, the more he can contribute.
• Taxpayers selling assets should consider installment sales,if spreading out the income would minimize the new tax.
• For some, life insurance may become more attractive. Because life-insurance proceeds at death aren't subject to this tax, a taxpayer could buy a policy, borrow from it and settle up at death, avoiding income tax on investment gains within the policy. But Mr. Nash cautions that the savings must outweigh the fees and other disadvantages such policies may have.
What it means for us, ordinary people is that our earnings will be taxes more. For workers, the extra 0.9% levy puts a progressive element in what used to be a totally flat tax. The 3.8% tax on investment income also knocks down a longstanding wall by applying a "payroll" tax to unearned income. Until now, FICA taxes for Social Security and Medicare have applied only to wages, not investment income.
While many details remain unclear and the Internal Revenue Service hasn't issued any guidance, here are preliminary answers to the most important questions taxpayers are asking.
These taxes take effect in 2013, two elections away. Might they be repealed first?
Not likely. "Congress would have to undo the health reform, and budget constraints would still be there," says Clint Stretch of Deloitte Tax. "Even if Republicans take control of Congress, President Obama holds the veto pen until Jan. 20, 2013."
How does the 0.9% tax work?
If Mark and Victoria each earn $175,000, their total employment income is $350,000. Currently they owe 1.45%—$5,075—of regular Medicare tax, and their employers owe a matching amount. In 2013, the couple will owe an extra 0.9%—$900—on their wages above $250,000, which is $100,000. Their employers pay nothing extra.
What about the 3.8% tax on net investment income?
This levy is keyed to "modified adjusted gross income," with a threshold of $250,000 for couples and $200,000 for singles. (This is simply adjusted gross income for nearly everybody except expatriates, who must add back certain exclusions.) The tax is a flat 3.8% on investment income above the threshold.
How would this work?
Example 1: Mark and Victoria, a married couple, have $400,000 of AGI—$200,000 of wages plus $200,000 of investment income. Because they have $150,000 of investment income above the $250,000 threshold, they would owe an extra $5,700.
Example 2: Anne, a single filer, earns $40,000 but has an investment windfall of $190,000, for total income of $230,000. Because she has investment income of $30,000 above her $200,000 threshold, she would owe $1,140 of additional tax.
Example 3: Retirees Mary and Bill have no wages but they do have a taxable IRA payout of $90,000, plus investment income of $150,000, for a total of $240,000. They don't owe the new tax, because they have no investment income above the $250,000 threshold.
What is investment income?
Interest, except municipal-bond interest; dividends; rents; royalties; and capital gains on the sales of financial instruments like stocks and bonds. The taxable portion of insurance annuity payouts also counts, unless it is from a company pension. So do gains from financial trading, as well as passive income from rents and businesses you don't participate in. All are subject to the 3.8% tax on amounts above the $250,000 or $200,000 threshold, as described above.
Not taxed: Distributions from regular and Roth IRAs and other retirement accounts, including pensions and Social Security, and annuities that are part of a retirement plan. Life-insurance proceeds, muni-bond interest and veterans' benefits don't count, nor does income from a business you participate in, such as a Subchapter S or partnership.
Could the 3.8% tax apply to gains on the sale of a home?
Yes, if there is a taxable gain above the $500,000 ($250,000, single) exclusion for gains on the sale of your residence.
Example: John and Jill, who bought their home in a New York suburb for $50,000 in 1972, sell it in 2013 for $1 million. After subtracting the $50,000 cost and $500,000 exclusion, they have investment income of $450,000. If they also have a taxable IRA payout of $70,000 and a pension of $30,000, they would owe the tax of $11,400 on $300,000.
What happens if a taxpayer who owes the new tax on investments also has a large itemized deduction—say, medical expenses or a theft loss?
Even if taxable income is zero because of deductions, he or she could still owe the 3.8% tax. Example: Myra is a single filer with investment income of $100,000 and wages of $200,000. But during the same year she loses $300,000 in a Ponzi scheme. She pays no income tax, but she still owes the new Medicare tax of $3,800 on her net investment income, says Sharon Kreider, a tax expert in Sunnyvale, Calif.
Does the 3.8% tax affect trusts and estates?
Yes, and it can hit them hard. The tax is levied on investment income as low as $12,000 that isn't paid out to beneficiaries. Some believe the tax may also hit children's unearned income subject to the "kiddie tax" if the parents owe it themselves.
What steps would Law Office of Inna Fershteyn recommend to minimize these taxes, other than taking capital gains before 2013 or buying municipal bonds?
• Examine both your regular and investment income: the higher your regular AGI, the more likely that your investment income will be subject to the new tax. So while Social Security and pensions don't count as investment income, they raise AGI. This makes Roth IRA conversions even more attractive for many. "Roth withdrawals don't raise AGI and aren't investment income," says Vern Hoven, a tax expert in Gig Harbor, Wash.
• Reconsider a defined-benefit pension if you're eligible. Pension payouts don't count as investment income, and the older a taxpayer is, the more he can contribute.
• Taxpayers selling assets should consider installment sales,if spreading out the income would minimize the new tax.
• For some, life insurance may become more attractive. Because life-insurance proceeds at death aren't subject to this tax, a taxpayer could buy a policy, borrow from it and settle up at death, avoiding income tax on investment gains within the policy. But Mr. Nash cautions that the savings must outweigh the fees and other disadvantages such policies may have.
Wednesday, May 5, 2010
Estate Planning Law Firm
Estate Planning Law Firm - The law office of Inna Fershteyn provides responsive, committed and result-oriented client service in the following areas: trust and estate planning, asset protection, business formation, corporate law, licensing and trademarks, medicaid, health care, immigration, family law, bankruptcy and others. The law office of Inna Fershteyn represents clients all over New York and New Jersey.
Saturday, April 24, 2010
Financial Advice by Women for Women
Several personal finance books aimed at women landed in my mailbox recently. They were hard to miss. The books had pink covers and the catchy, if cringeworthy, titles, “Shoo, Jimmy Choo!” and “Hot (Broke) Messes.” And then there was the one I found on Amazon, “A Purse of Your Own.”
The titles may seem better suited for the cover of Glamour magazine. But that doesn’t mean women don’t face special financial challenges. Women live longer, earn less and take more breaks from the workplace to care for children and elderly parents. And though studies show that women tend to save a slightly higher percentage of their paychecks then men, they ultimately end up with smaller balances because of their lower earnings.
Does that mean women need specially tailored financial advice?
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The titles may seem better suited for the cover of Glamour magazine. But that doesn’t mean women don’t face special financial challenges. Women live longer, earn less and take more breaks from the workplace to care for children and elderly parents. And though studies show that women tend to save a slightly higher percentage of their paychecks then men, they ultimately end up with smaller balances because of their lower earnings.
Does that mean women need specially tailored financial advice?
continue
Saturday, April 17, 2010
ESTATE TAX JACKPOT 2010 - Oil Magnate’s Death Costs U.S. Millions in Foregone Taxes
When rich people pass away, they often get prominent obituaries. This year, they will get special arbituary - compliments of the 2010 estate tax!
As readers of my blog know, the estate tax expired at the end of 2009 and will take the year off before coming back in 2011. That means wealthy people who pass away in 2010 don’t pay any estate tax.
So it is with extra interest that we note the death of Dan Duncan, the gas-pipeline tycoon who Forbes pegged as the 74th richest man in the world. He passed away in March at age 77. His estate was valued at an estimated $9 billion. That made him the first billionaire in this country to die without an estate tax in nearly 100 years.
It also means the U.S. just lost out on millions of dollars in foregone revenue because no estate tax was in place. All because Congress couldn’t agree on a new estate tax.
Nobody in Congress really expected a billionaire of Dan Duncan’s caliber to die this year without significant estate protection already in place. In fact, the Congressional Joint Committee on Taxation estimated last year that restoring the estate tax at 2009 levels would have only added about $468 million to the federal government’s 2010 revenue.
Of course, it is highly unlikely that Mr. Duncan was going to leave his entire $9 billion estate subject to the tax. He was a big philanthropist and most likely had bequests to charity in his will.
I think that if his advisors were up to the job, the bulk of his remaining wealth was probably held in irrevocable trust or tax shelter entities. Still, he did have hundreds of millions of dollars tied up in businesses, so that could have been taxed.
For all my readers out there - do your ESTATE PLANNING now! It doesn't look like you will get a windfall of 2010 and I feel that next year the exemption on Estate Tax will go back to the initial $1 million mark.
As readers of my blog know, the estate tax expired at the end of 2009 and will take the year off before coming back in 2011. That means wealthy people who pass away in 2010 don’t pay any estate tax.
So it is with extra interest that we note the death of Dan Duncan, the gas-pipeline tycoon who Forbes pegged as the 74th richest man in the world. He passed away in March at age 77. His estate was valued at an estimated $9 billion. That made him the first billionaire in this country to die without an estate tax in nearly 100 years.
It also means the U.S. just lost out on millions of dollars in foregone revenue because no estate tax was in place. All because Congress couldn’t agree on a new estate tax.
Nobody in Congress really expected a billionaire of Dan Duncan’s caliber to die this year without significant estate protection already in place. In fact, the Congressional Joint Committee on Taxation estimated last year that restoring the estate tax at 2009 levels would have only added about $468 million to the federal government’s 2010 revenue.
Of course, it is highly unlikely that Mr. Duncan was going to leave his entire $9 billion estate subject to the tax. He was a big philanthropist and most likely had bequests to charity in his will.
I think that if his advisors were up to the job, the bulk of his remaining wealth was probably held in irrevocable trust or tax shelter entities. Still, he did have hundreds of millions of dollars tied up in businesses, so that could have been taxed.
For all my readers out there - do your ESTATE PLANNING now! It doesn't look like you will get a windfall of 2010 and I feel that next year the exemption on Estate Tax will go back to the initial $1 million mark.
Monday, April 12, 2010
Празднование 62-й годовщины основания Израиля - в Manhattan Beach Jewish Center
Уважаемые господа! Я, адвокат Инна Ферштейн, член совета JCH of Bensonhurst, рада пригласить всех и каждого из Вас (вместе со своей половинкой) на незабываемое мероприятие, которое я организую в Manhattan Beach Jewish Center - празднование 62-й годовщины основания Израиля, изюминкой программы которого станет выступление полковника ЦАХАЛа (Армии обороны Израиля) Бенци Грубера.
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Wednesday, March 17, 2010
FREE ESTATE PLANNING CONFERENCE at Kings Bay Y, Brooklyn NY on June 16, 2011, at 6pm
The Law Offices of Inna Fershteyn will host TRUST and ESTATE SEMINAR:
Common Mistakes in Estate Planning:
June 16, 2011 6 PM, King Bay Y
To register, call Law Office of Inna Fershteyn at (718) 333-2394.
For more information, please visit our website
Trust and Estate Planning Law Firm of New York
Common Mistakes in Estate Planning:
June 16, 2011 6 PM, King Bay Y
To register, call Law Office of Inna Fershteyn at (718) 333-2394.
For more information, please visit our website
Trust and Estate Planning Law Firm of New York
Monday, March 8, 2010
Obama's Health Reform news
Over the past year the House and the Senate have been working on an effort to provide health insurance reform that lowers costs, guarantees choices, and enhances quality health care for all Americans.
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Saturday, February 13, 2010
Redundant Fees Destroy 403(b) Retirement Assets
Redundant Fees Destroy 403(b) Retirement Assets: What the Insurance Companies Do
Not Want You to Know
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Not Want You to Know
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California couple sues VALIC over its annuity sales practices
A California couple has filed suit against The Variable Annuity Life Insurance Co., an American International Group Inc. subsidiary, claiming that the company's sales agents misled investors about the tax advantages of using variable annuities in qualified retirement plans.
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The Unloved Annuity Gets a Hug From Obama
Annuities: The official retirement vehicle of the Obama administration.
As slogans go, it’s hardly “Keep Hope Alive,” or even “Change We Can Believe In.”
But there were annuities, in a report from the administration’s Middle Class Task Force that came out this week. They are among the tools the administration is promoting as it tries to give Americans a better shot at a more secure retirement.
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As slogans go, it’s hardly “Keep Hope Alive,” or even “Change We Can Believe In.”
But there were annuities, in a report from the administration’s Middle Class Task Force that came out this week. They are among the tools the administration is promoting as it tries to give Americans a better shot at a more secure retirement.
continue
Monday, February 1, 2010
2010: The Year of the Renter?
SCORES of stalled construction projects can be found scattered around New York City, but one category of building that doesn’t seem to have been sidetracked by the recession is the luxury apartment rental.
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Monday, January 25, 2010
Alpha Wives: The Trend and the Truth
Why are more American men marrying women who make more money than they do? Maybe it is the simple fact that more higher-earning women are available. And social norms have changed, with the benefits of such unions supposedly winning out over the perceived blow to the male ego.
After a Pew Research Center study came out last week reporting on the rise of the breadwinning wife, the debate began.
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After a Pew Research Center study came out last week reporting on the rise of the breadwinning wife, the debate began.
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Saturday, January 23, 2010
She Works. They’re Happy.
EVER since Betty Friedan urged women to leave the house and pursue careers, people have argued over whether women’s marriages and romantic prospects would suffer for it. Was a financially successful woman a threat to her husband or a relief?
Last week, a report from the Pew Research Center about what it called “the rise of wives” revived the debate. Based on a study of Census data, Pew found that in nearly a third of marriages, the wife is better educated than her husband. And though men, over all, still earn more than women, wives are now the primary breadwinner in 22 percent of couples, up from 7 percent in 1970.
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Last week, a report from the Pew Research Center about what it called “the rise of wives” revived the debate. Based on a study of Census data, Pew found that in nearly a third of marriages, the wife is better educated than her husband. And though men, over all, still earn more than women, wives are now the primary breadwinner in 22 percent of couples, up from 7 percent in 1970.
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FREE ESTATE PLANNING SEMINAR at JCH of BENSONHURST
The Law Offices of Inna Fershteyn and McLain Accounting Services are proud to present Business and Estate Planning Seminar that will take place at JCH of Bensonhurst on February 9, 2010 at 7 p.m. at 7802 Bay Pkwy, Brooklyn, NY 11214.
Inna Fershteyn, a leading attorney in Trust and Estate Planning field will answer your questions regarding Trust and Estate Law, Business Continuation Planning, Asset Protection, Medicaid Planning, Wills and Trusts.
To register, call Law Office of Inna Fershteyn at (718) 333-2394.
For more information, please visit our website
www.advanced-legal.com
Inna Fershteyn, a leading attorney in Trust and Estate Planning field will answer your questions regarding Trust and Estate Law, Business Continuation Planning, Asset Protection, Medicaid Planning, Wills and Trusts.
To register, call Law Office of Inna Fershteyn at (718) 333-2394.
For more information, please visit our website
www.advanced-legal.com
Friday, January 22, 2010
Dying 13 hrs. too soon cost $3 mil in taxes
By SUSAN EDELMAN
If Fritz Lohman had only known, he would have waited another 13 hours to kick the bucket.
Lohman, 87, a SoHo real-estate magnate who pioneered the exhibition of gay art, died at home at about 11 a.m. on New Year's Eve after a long illness.
If he had instead passed away after midnight Jan.1, his partner of 48 years could have avoided paying at least $3 million in estate taxes -- thanks to Congress letting that levy lapse for 2010.
"He would probably say, 'Why didn't they tell me? I could have waited another day,' " said Charles Leslie, 76, Lohman's business and life partner -- and the sole beneficiary to his $10 million estate. "It's so utterly ludicrous," Leslie said. "You think you've done everything right, taken every precaution, and then by some congressional fiat your life turns upside down."
"What a difference a day makes -- literally," added Leslie's estate lawyer, Erica Bell.
Bell and others are shocked that Congress failed by the end of 2009 to extend the "death tax" in 2010 for the richest Americans. The rate is 45 percent of assets beyond the first $3.5 million.
Under current law, the estate tax is gone for one year, but will be reinstated -- and raised -- in 2011 for beneficiaries of more than $1 million.
"That means, if you have a choice and someone is probably going to die soon, it would be better this year than next," Bell said. "The joke is, 'Throw momma from the train.' "
She added, "This is not good public policy. There's something really wrong with a tax law that suggests when it's good to die."
But that dilemma tormented another New York family whose wealthy mother was terminally ill in December.
"The family could have put her on aggressive, artificial life support, with tubes and medical devices, until January 1, thereby saving $3 million in federal estate taxes," a source said. "The family chose the kinder path -- letting her die naturally and peacefully." She didn't make it to New Year's Day.
Leslie said his tax bills may force him to sell some of the SoHo commercial properties he and Lohman bought years ago, investments that made them a fortune. The debonair Lohman also ran a high-end interior decorating business.
Leslie is stoic about the irony of the timing of Lohman's death.
"You can't second guess things like that. We do not happen to life -- life happens to us."
And the second issue to discuss is “ Medicaid for millionaires” -
The health bills passed in Congress will prohibit states from using "asset tests" to screen people applying for Medicaid -- which critics charge will enable those with yachts and million-dollar properties to get taxpayer-financed medical coverage.
The more lax rules -- which New York put in place on its own Jan. 1 -- require applicants for public health insurance to provide only proof of income, not other assets.
"This is a screening system that is going to be fraught with abuse and fraud. You have no finger imaging, no photo identification card, and now no asset test," said state Sen. Martin Golden (R-Brooklyn).
Other critics say the new policy will drive up health-care costs.
"It's an abuse of the taxpayers' generosity . . . If somebody has a million dollars of assets, why wouldn't we expect them to use their own assets before they ask their neighbors to pay their health-care bill?" said Dennis Smith, policy adviser with the Heritage Foundation, a conservative think tank.
Paterson and other Democrats claim stricter asset tests unnecessarily impede access.
The changes have made "applying for benefits less onerous for struggling families and local governments," said Paterson spokesman Peter Kauffmann.
If Fritz Lohman had only known, he would have waited another 13 hours to kick the bucket.
Lohman, 87, a SoHo real-estate magnate who pioneered the exhibition of gay art, died at home at about 11 a.m. on New Year's Eve after a long illness.
If he had instead passed away after midnight Jan.1, his partner of 48 years could have avoided paying at least $3 million in estate taxes -- thanks to Congress letting that levy lapse for 2010.
"He would probably say, 'Why didn't they tell me? I could have waited another day,' " said Charles Leslie, 76, Lohman's business and life partner -- and the sole beneficiary to his $10 million estate. "It's so utterly ludicrous," Leslie said. "You think you've done everything right, taken every precaution, and then by some congressional fiat your life turns upside down."
"What a difference a day makes -- literally," added Leslie's estate lawyer, Erica Bell.
Bell and others are shocked that Congress failed by the end of 2009 to extend the "death tax" in 2010 for the richest Americans. The rate is 45 percent of assets beyond the first $3.5 million.
Under current law, the estate tax is gone for one year, but will be reinstated -- and raised -- in 2011 for beneficiaries of more than $1 million.
"That means, if you have a choice and someone is probably going to die soon, it would be better this year than next," Bell said. "The joke is, 'Throw momma from the train.' "
She added, "This is not good public policy. There's something really wrong with a tax law that suggests when it's good to die."
But that dilemma tormented another New York family whose wealthy mother was terminally ill in December.
"The family could have put her on aggressive, artificial life support, with tubes and medical devices, until January 1, thereby saving $3 million in federal estate taxes," a source said. "The family chose the kinder path -- letting her die naturally and peacefully." She didn't make it to New Year's Day.
Leslie said his tax bills may force him to sell some of the SoHo commercial properties he and Lohman bought years ago, investments that made them a fortune. The debonair Lohman also ran a high-end interior decorating business.
Leslie is stoic about the irony of the timing of Lohman's death.
"You can't second guess things like that. We do not happen to life -- life happens to us."
And the second issue to discuss is “ Medicaid for millionaires” -
The health bills passed in Congress will prohibit states from using "asset tests" to screen people applying for Medicaid -- which critics charge will enable those with yachts and million-dollar properties to get taxpayer-financed medical coverage.
The more lax rules -- which New York put in place on its own Jan. 1 -- require applicants for public health insurance to provide only proof of income, not other assets.
"This is a screening system that is going to be fraught with abuse and fraud. You have no finger imaging, no photo identification card, and now no asset test," said state Sen. Martin Golden (R-Brooklyn).
Other critics say the new policy will drive up health-care costs.
"It's an abuse of the taxpayers' generosity . . . If somebody has a million dollars of assets, why wouldn't we expect them to use their own assets before they ask their neighbors to pay their health-care bill?" said Dennis Smith, policy adviser with the Heritage Foundation, a conservative think tank.
Paterson and other Democrats claim stricter asset tests unnecessarily impede access.
The changes have made "applying for benefits less onerous for struggling families and local governments," said Paterson spokesman Peter Kauffmann.
Поиск выхода
Роман Янушевский
"Вести", приложение "Вести - 2",
30 декабря 2009 г.
Мировое еврейство находится на очередном перекрестке, испытывая кризис идентичности и идеологии. Возможно, это наиболее серьезный вызов, с которым пришлось ему столкнуться за всю его историю. Идет активный поиск выхода из сложившейся ситуации, потому что ассимиляция продолжается во всех странах мира, кроме Израиля. Постсоветское еврейство, раскиданное по всему миру, начинает осознавать свою уникальную роль в этом поиске.
Наиболее уязвимое звено, легче всего подвергающееся ассимиляции – молодежь. Она более открыта для любых новых веяний. Не получив необходимого еврейского образования и не поняв для себя, зачем ей сохранять свое еврейство, любить и защищать Израиль, ей проще всего уйти и заниматься чем-то другим. Современному миру есть что предложить и в плане работы, и в плане общественной самореализации, ну и в плане развлечений.
Read the full story
"Вести", приложение "Вести - 2",
30 декабря 2009 г.
Мировое еврейство находится на очередном перекрестке, испытывая кризис идентичности и идеологии. Возможно, это наиболее серьезный вызов, с которым пришлось ему столкнуться за всю его историю. Идет активный поиск выхода из сложившейся ситуации, потому что ассимиляция продолжается во всех странах мира, кроме Израиля. Постсоветское еврейство, раскиданное по всему миру, начинает осознавать свою уникальную роль в этом поиске.
Наиболее уязвимое звено, легче всего подвергающееся ассимиляции – молодежь. Она более открыта для любых новых веяний. Не получив необходимого еврейского образования и не поняв для себя, зачем ей сохранять свое еврейство, любить и защищать Израиль, ей проще всего уйти и заниматься чем-то другим. Современному миру есть что предложить и в плане работы, и в плане общественной самореализации, ну и в плане развлечений.
Read the full story
More Men Marrying Wealthier Women
Beagy Zielinski is a German-born 28-year-old stylist who moved to New York to study fashion in 1995 and stayed. Just before Christmas, she broke up with her blue-collar boyfriend, who repaired Navy ships.
"He was extremely insecure about my career and how successful I am," Ms. Zielinski said.
An analysis of census data to be released Tuesday by the Pew Research Center found that she and countless women like her are victims of a role reversal that is profoundly affecting the pool of potential marriage partners.
"Men now are increasingly likely to marry wives with more education and income than they have, and the reverse is true for women," said Paul Fucito, spokesman for the Pew Center. "In recent decades, with the rise of well-paid working wives, the economic gains of marriage have been a greater benefit for men."
Read the full story
"He was extremely insecure about my career and how successful I am," Ms. Zielinski said.
An analysis of census data to be released Tuesday by the Pew Research Center found that she and countless women like her are victims of a role reversal that is profoundly affecting the pool of potential marriage partners.
"Men now are increasingly likely to marry wives with more education and income than they have, and the reverse is true for women," said Paul Fucito, spokesman for the Pew Center. "In recent decades, with the rise of well-paid working wives, the economic gains of marriage have been a greater benefit for men."
Read the full story
Пришел, проглядел, проиграл
Молодость - это недостаток. И хотя со временем он проходит, но Америка не успела: Барак Обама стал президентом, а его политическая молодость (вернее, инфантильность) может привести к такому же результату, как у Джона Кеннеди, который тоже был очень обаятелен и улыбчив, до самой смерти считался мальчишкой, своими студенческо-фестивальными повадками убедил Хрущева в том, что он слабак, и Хрущев поволок ракеты на Кубу (теперь уже и Фидель заявляет, что они были ему совсем не нужны).
Инфантильность Кеннеди вылилась в Карибский кризис, и мир только чудом уцелел. Путин же "отцам-иезуитам вполне достойный сын" (Нателла Болтянская), и хватка у него железная. Использовать Барака Обаму, жалующегося на американскую демократию в полутоталитарной Москве, для него плевое дело. К беде неопытность ведет, и не только в пределах Татьяниной девичьей судьбы.
Говорила я американцам: выбирайте Маккейна, старый президент борозды не испортит. Маккейн пожил на свете, сражался с красными, был в плену, умирал, страдал, ненавидел, знает, почем фунт лиха и какая это лживая дешевка - разрядка, когда речь идет о братании с режимами, не признающими западные, то есть общечеловеческие ценности. С одним Гарвардом в багаже в президенты лучше не ходить.
Америка - единственный в мире хранитель западных ценностей, а ее президент - страж. Воин. Не популяризатор, не массовик-затейник. Да и какие американские ценности мог популяризировать Обама, равнодушно прошедший мимо клетки, где томятся Лебедев и Ходорковский, и мимо суда, где пытаются дать срок Андрею Ерофееву и Юрию Самодурову за организацию художественной выставки? Закон о защите свободы такого поведения американского истеблишмента не предусматривает.
Можно, конечно, как Никсон (и не в Уотергейте дело, Бог с ним, с Уотергейтом): обменять на страшный, жестокий, тоталитарный Китай демократический Тайвань, лишив демократию места в ООН и отдав его маоистам. За лишнюю пару кроссовок (хотя их и на Тайване сделать можно), за лишний доллар инвестиций.
По-моему, это худший вид коррупции. Лучше украсть половину госбюджета, чем выбирать Зло, делать союз со Злом содержанием американской политики и уменьшать в мире количество Добра (а потом посылать на борьбу с этим Злом авианосцы и морских пехотинцев). Себе дороже. Что теперь будет с Грузией (крейсер в Батуми зашел, это явно с подачи Конгресса и тамошних республиканцев; слава Богу, это США, и президент там не диктатор) и Ходорковским?
Как это у Толстого в "Царе Федоре Иоанновиче" сказано про перезагрузку отношений Шуйского и Годунова - когда Годунов стал арестовывать (после примирения) сторонников Шуйских? "Вы нашими миритесь головами". И как унизил Обама российских демократов Владимира Рыжкова, Гарри Каспарова и Бориса Немцова! Посадил сторонников американских ценностей, защитников и сторонников США рядом с кремлевскими холуями типа Леонида Гозмана или врагами США (такими, как Сергей Митрохин из "Яблока", коммунистами, "Справедливой Россией")... Борис Немцов напомнил Обаме про то, что в бытность свою сенатором он подписывал вместе с Маккейном резолюцию в защиту Ходорковского. Ах, где же снег былых времен?
Борис Немцов вообще пошел на этот недостойный сходняк в надежде защитить Ходорковского. Увы, Обаме на это наплевать. И на других заключенных тоже. Это вам не Рональд Рейган, назвавший СССР "империей зла". Это вам не Джимми Картер, зачитывавший Конгрессу список советских политзаключенных. Обама приехал "договорчики с большевиками подписывать". И кто сказал, что демократы больше республиканцев радеют за гражданские права и права человека? Демократы Рузвельта сидели дипломатами в Третьем рейхе после оккупации Чехословакии, после Хрустальной ночи, после начала Второй мировой войны. До 1941 года. До Перл-Харбора. Пока американские солдаты не погибли из-за трусости и подлости американских политиков. Зато потом демократу Трумэну пришлось бросать на Хиросиму и Нагасаки атомную бомбу: другого выхода не осталось.
Да, не получилось у Обамы veni, vidi, vici. Он пришел, ничего не увидел и проиграл чекистам этот баскетбол. Это мы, а не Обама защищаем в России вечные американские ценности. Это мы, а не он и не его левые советники готовы отдать за них жизнь. Дай Бог миру и Америке пережить Обаму с его дешевым шоу-бизнесом, на который он разменял вечные идеалы свободы. Надеюсь, американцы увидят, услышат и не простят.
Валерия Новодворская
Инфантильность Кеннеди вылилась в Карибский кризис, и мир только чудом уцелел. Путин же "отцам-иезуитам вполне достойный сын" (Нателла Болтянская), и хватка у него железная. Использовать Барака Обаму, жалующегося на американскую демократию в полутоталитарной Москве, для него плевое дело. К беде неопытность ведет, и не только в пределах Татьяниной девичьей судьбы.
Говорила я американцам: выбирайте Маккейна, старый президент борозды не испортит. Маккейн пожил на свете, сражался с красными, был в плену, умирал, страдал, ненавидел, знает, почем фунт лиха и какая это лживая дешевка - разрядка, когда речь идет о братании с режимами, не признающими западные, то есть общечеловеческие ценности. С одним Гарвардом в багаже в президенты лучше не ходить.
Америка - единственный в мире хранитель западных ценностей, а ее президент - страж. Воин. Не популяризатор, не массовик-затейник. Да и какие американские ценности мог популяризировать Обама, равнодушно прошедший мимо клетки, где томятся Лебедев и Ходорковский, и мимо суда, где пытаются дать срок Андрею Ерофееву и Юрию Самодурову за организацию художественной выставки? Закон о защите свободы такого поведения американского истеблишмента не предусматривает.
Можно, конечно, как Никсон (и не в Уотергейте дело, Бог с ним, с Уотергейтом): обменять на страшный, жестокий, тоталитарный Китай демократический Тайвань, лишив демократию места в ООН и отдав его маоистам. За лишнюю пару кроссовок (хотя их и на Тайване сделать можно), за лишний доллар инвестиций.
По-моему, это худший вид коррупции. Лучше украсть половину госбюджета, чем выбирать Зло, делать союз со Злом содержанием американской политики и уменьшать в мире количество Добра (а потом посылать на борьбу с этим Злом авианосцы и морских пехотинцев). Себе дороже. Что теперь будет с Грузией (крейсер в Батуми зашел, это явно с подачи Конгресса и тамошних республиканцев; слава Богу, это США, и президент там не диктатор) и Ходорковским?
Как это у Толстого в "Царе Федоре Иоанновиче" сказано про перезагрузку отношений Шуйского и Годунова - когда Годунов стал арестовывать (после примирения) сторонников Шуйских? "Вы нашими миритесь головами". И как унизил Обама российских демократов Владимира Рыжкова, Гарри Каспарова и Бориса Немцова! Посадил сторонников американских ценностей, защитников и сторонников США рядом с кремлевскими холуями типа Леонида Гозмана или врагами США (такими, как Сергей Митрохин из "Яблока", коммунистами, "Справедливой Россией")... Борис Немцов напомнил Обаме про то, что в бытность свою сенатором он подписывал вместе с Маккейном резолюцию в защиту Ходорковского. Ах, где же снег былых времен?
Борис Немцов вообще пошел на этот недостойный сходняк в надежде защитить Ходорковского. Увы, Обаме на это наплевать. И на других заключенных тоже. Это вам не Рональд Рейган, назвавший СССР "империей зла". Это вам не Джимми Картер, зачитывавший Конгрессу список советских политзаключенных. Обама приехал "договорчики с большевиками подписывать". И кто сказал, что демократы больше республиканцев радеют за гражданские права и права человека? Демократы Рузвельта сидели дипломатами в Третьем рейхе после оккупации Чехословакии, после Хрустальной ночи, после начала Второй мировой войны. До 1941 года. До Перл-Харбора. Пока американские солдаты не погибли из-за трусости и подлости американских политиков. Зато потом демократу Трумэну пришлось бросать на Хиросиму и Нагасаки атомную бомбу: другого выхода не осталось.
Да, не получилось у Обамы veni, vidi, vici. Он пришел, ничего не увидел и проиграл чекистам этот баскетбол. Это мы, а не Обама защищаем в России вечные американские ценности. Это мы, а не он и не его левые советники готовы отдать за них жизнь. Дай Бог миру и Америке пережить Обаму с его дешевым шоу-бизнесом, на который он разменял вечные идеалы свободы. Надеюсь, американцы увидят, услышат и не простят.
Валерия Новодворская
Incredible story for everyone to see
Dear all, I have to forward this video to all of you - it’s very inspirational. Considering I just visited Yad Vashem in Israel with American Jewish Committee, this hit right at home.
My mom saw this video and decided to show it to all of her 5-8 grade classes at Manhattan Beach Yeshivah… I didn’t show it yet to my kids – I will save it until they get a bit older. However we can all learn from this incredible survival story and realize the value of EACH life that someone saves…
Click here to view the video
My mom saw this video and decided to show it to all of her 5-8 grade classes at Manhattan Beach Yeshivah… I didn’t show it yet to my kids – I will save it until they get a bit older. However we can all learn from this incredible survival story and realize the value of EACH life that someone saves…
Click here to view the video
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