Florida Asset Protection, Estate Planning, Probate and Elder Law Blog
C. Randolph Coleman
The Coleman Law Firm, PLLC
9250 Baymeadows Rd, Ste 450
Jacksonville, FL  32256
Phone: (904) 448-1969
Fax: (904) 448-5244
Email:  RColeman@TheColemanLawFirm.net
Florida Asset Protection & Estate Planning Blog

Income Tax Planning - Now of More Concern Than The Estate Tax

The American Taxpayer Relief Act of 2012 (which became law on January 2, 2013) made permanent the temporary estate/gift/generation-skipping transfer tax exemptions established in December 2010, increased the rate on non-exempt estates/gifts/generation-skipping transfers to 40% and introduced substantial new income tax burdens on high income taxpayers and trusts. In addition, 2013 is the year in which both of the Medicare surtaxes of the Patient Protection and Affordable Care Act of 2010 (sometimes referred to as “Obamacare”) kick in. As a result, many people will want to consult their wealth planning professionals for doing more income tax planning, and estate tax planning will become less of a driving force.
 
In this post, we will examine some of the new income tax provisions you will face in 2013 and beyond and potential planning opportunities that remain in light of these provisions, as well as some different ideas to consider. ...

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Why Estate Planning Is Still Important

Did you know that April is National Financial Literacy Month?
 

This is the perfect time to sit down with your loved ones to discuss your financial and estate planning objectives. To help you move the discussion forward, we would like to suggest three action items: 
 
(1) Gather around the computer monitor with your family and view this
webinar recording “The Family Estate Plan: Why You Should Have One and What Happens If You Don’t”
 
(2) Register for the June 21 webinar “
Life Expectancy and Health Care Planning
 
(3) Download this
...

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Famous Probate Case - Atypically Typical

Today's New York Times contains an article about the death of "Barbara Piasecka Johnson, Maid Who Married Multimillionaire, Dies at 76."

Barbara Piasecka Johnson, a Polish immigrant who came to America to work as a maid, first worked for J. Seward Johnson, Sr., the heir to the Johnson & Johnson Band-Aid and baby powder fortune - and then married him.

At his death his six children challenged the will that gave her practically all of Johnson' $500 million net worth. One writer has referred to the probate case as "the largest, costliest, ugliest, most spectacular and most conspicuous" probate battle in American History.

The three year probate litigation generated $24 million in attorney's fees. At the end of the probate litigation, Mrs. Johnson, who came to the United States in 1968 with $200 in her pocket, inherited more than $300 million from her husband's estate at the conclusion of the ...
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Using Trusts to Protect Inherited IRAs

Many people have large IRAs and retirement plan accounts and need special estate planning for these assets. A 2009 study by the Investment Company Institute found that retirement plans account for 34% of all household financial assets, up from 14% in 1978; IRAs alone account for more than 10% of all household financial assets; and 47 million U.S. households have IRAs.
 
Compare these numbers to the approximately 4,000 estate tax returns that will be required to be filed annually under the new “permanent” estate tax exemption of $5 million adjusted for inflation, and it is easy to see that planning for retirement accounts presents a more significant opportunity for the estate planning advisory team than does estate tax planning.
 
Most people want to protect their IRA and retirement plan assets for their families, but most do ...

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Helping You Avoid A Tangled Web Left By Loved Ones

For the last two months, we have been singularly focused on helping people get their end of the year planning in place and moving our office to a new location. The year end for 2012 was more busy than usual because of all of the uncertainty surrounding the tax environment, and especially the prospect of estate and gift tax changes that could have created significant increases in those two taxes beginning January 1 of this year. So December was quite hectic.

Then, we packed up our office (after more than 15 years), and moved to a new location. One of the most disruptive activities any small business can experience.

We now have concluded all of the end of the year transactions, Congress has gotten past the fiscal cliff (at least the first part), and we have gotten settled into our new office. Time to focus on the needs of our clients for estate planning, asset protection, Medicaid long term care planning and providing support for them ...
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The New Tax Law - It's Impact on You!

Here's Our Take On What the New Tax Law Means to You

 

The law passed at New Years to deal with the so-called “fiscal cliff” included revisions to estate, gift and generation-skipping transfer (“GST”) tax laws and income tax laws that will affect estate planning for the foreseeable future. In this post we will take a first look at those changes and what they will mean to you.
 
Changes to the Federal Estate Tax Law
 
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Tis the Season . . . to Gift (or Not)

We have discussed the 2012 tax-saving opportunity quite a bit here lately. You can read previous posts here and here. This article continues our conversation by providing our clients and readers a number of factors to consider when deciding whether to gift or not to gift.

For those who are just “tuning in” to the discussion, the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (“the Act”), significantly alters the federal estate and gift tax system, which impacts estate planning for many individuals and presents excellent estate planning opportunities. Namely, an individual can give away more than $5,000,000 of their assets now and remove those assets and any appreciation in their value from their future taxable estate. For married couples, this amount jumps to more than $10,000,000.

Needless to say, the Act has sparked quite a few questions for our clients. We are hearing ...

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Taxpayers, are you ready for Obamacare?

        If you are like me, you remember exactly where you were the moment you found out that Obamacare had been upheld by the Supreme Court.  No matter your party or political persuasion, and regardless of whether you celebrated or groaned at the news, the vast majority of Americans were consciously awaiting this decision. But do you know exactly what this law means for you as a Taxpayer?  If not, you should keep reading…

 

        Here is what to expect next year, in 2013:

  • Medicare taxes increase for upper-income earners. A surtax of 0.9% for single individuals with more than $200,000 in wages and couples earning over $250,000. The surtax is on the employee’s share of payroll taxes. The surtax hits the self-employed as well.
  • Unearned income is subject to a 3.8% Medicare surtax for single individuals with a modified adjusted gross income (“AGI”) in excess of $200,000 and ...
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What is your risk of being sued?

We've talked quite a bit about asset protection lately:  Why Floridians Need Asset Protection Planning; September's Crazy Lawsuits; Asset Protection for Physicians - Discussion and Dinner. It seems that no matter how much asset protection may be emphasized, no one believes they are at risk of being sued if they don't own a business or aren't rendering services as a physician. Most people move about their daily lives without concern about many potential sources of personal liability.

Now there is a way to gauge your exposure to ordinary, every day risks. ACE Private Risk Services has developed a little quiz that can help you understand the potential risk of a lawsuit faced by people in the private lives, as opposed ...
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September's Crazy Lawsuits

This month brings news of another group of ridiculous lawsuits, and coming on the heals of Florida's ranking among the ten worst states for lawsuits, provides more fresh evidence of the need for asset protection planning. Take a look at these "winners" and go to the U.S. Chamber's Institute for Legal Reform site to vote on the one you think is the most ridiculous.

1.   
California restauranteur sued over parking lot he doesn't lease or own.

    This lawsuit was filed by Scott Johnson, who has filed 140 of the total of 200 lawsuits filed against local businesses in the Eastern District of California, for violations of the Americans with Disabilities Acts. One of the main claims in the lawsuit filed ...
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Why Floridians Need Asset Protection Planning

The U.S. Chamber Institute for Legal Reform has ranked Florida among the 10 worst states for lawsuits. The biggest concern is the huge damage awards by Florida juries. The Institute's conclusions provide ample reason to engage in asset protection planning. Remember asset protection planning works best when it is implemented before it is needed.

Here's a copy of the press release from the Institute and a short video from the Institute's president.



Florida’s Lawsuit Climate Among Worst in the Nation

September 10, 2012

Seven in 10 business leaders say lawsuit climate ‘significant factor’ in determining where to expand, grow

WASHINGTON, D.C. — A new national survey released today by the U.S. ...

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Assets Abandoned and Forgotten by Even the Wealthy

Saturday's New York Times contained an article of interest. The New York socialite Brooke Astor apparently has bank accounts at CitiBank that have not yet been discovered by the executor of her estate - despite the fact that she died in 2007. You can see the article here:  http://www.nytimes.com/2012/09/08/nyregion/abandoned-brooke-astor-bank-accounts-surface-in-ad.html?_r=1&emc=tnt&tntemail1=y

The article reminds us that even the wealthiest and those with accountants and lawyers working for them still sometimes overlook what can be valuable assets. The above article references one abandoned account with the New York Comptroller's office that is valued at more than $1.7 million!

In Florida, you can find lost assets from forgotten and abandoned bank accounts, securities, dividends that didn't make it to you, and other unclaimed assets listed by Florida's Chief Financial Officer at
www.FLTreasureHunt.org.

If you are the personal represnetative ...
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Act Now to Take Advantage of a Tax-Saving Opportunity

Legislation in effect until December 31, 2012 makes the present a particularly important time for tax planning. In late 2010, Congress passed and the President signed into law the Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 (the “Act”). The Act provides a two-year reprieve from higher tax rates and lower credit amounts that are typically characteristic of wealth transfer taxes, such as the estate tax, the gift tax and the generation skipping transfer tax.

The Act mandated a lifetime gift tax credit of $5,000,000 and a maximum rate of gift tax of 35 percent. (The credit for 2012 is $5,120,000 as it is indexed for inflation.)  Be careful not to dismiss this opportunity because you say to yourself, ‘I don’t have $5,000,000, or anywhere close to it;’ you will have missed the proverbial boat. Absent further action by Congress, the lifetime gift tax credit will return to $1,000,000 on January 1, 2013, and the maximum rate will jump to 55 percent. As is obvious, 2011 ...

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Increasing Importance of Special Needs Planning

Recently, The Coleman Law Firm was privileged to be a sponsor of the 10th Annual Angelwood Fashion Show and Luncheon, a wonderful event that raises funds for programs supporting children and adults with Autism, Cerebral Palsy, Down’s syndrome, Spina Bifida and intellectual disabilities. The event not only served to benefit a very worthy cause, it was a reminder of the fragility of life and the importance of special needs planning.

Special needs planning is an area of law that takes on many shapes and forms. This is because the number of diseases and tragedies that can, at any given moment, affect us and our loved ones are countless. Autism affects 1 in 88 children – 1 in 54 boys. (That’s a 10-fold increase in prevalence in 40 years.)  Autism affects over 2 million individuals in ...

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The 13 Most Frequent Medicaid Mistakes for Nursing Home Care

As our population grows older, more and more families will face the need for long term care for their loved ones. The cost of a skilled nursing home care in Florida averages about $7,000 to $8,000 per month. That number increases each year.

Medicare does not cover the cost of skilled nursing home care (except for rehabilitation usually with a limit of 100 days of coverage). Beyond that limited coverage, the family must pay the full cost of skilled nursing home care.

Most studies suggest that the average family will exhaust the family's life savings within the first year of skilled nursing home care!  Without long term care insurance, practically all nursing home residents will eventually end up needing Medicaid to pay for the nursing home care.

When faced with the reality of the cost of nursing home care, and the almost certain eventual need for Medicaid eligibility to pay for the nursing home, most families engage in actions that can result in loss of eligibility ...
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Asset Protection for Physicians - Discussion and Dinner

On September 11, 2012, The Diamond Group (an investment firm) is hosting a dinner meeting for members and prospective members of the Duval County Medical Society. Arni Diamond, the principal for The Diamond Group has invited me to speak on the topic of asset protection for doctors.

My topics for the evening will be: "Six Things Every Physician Should Know About Estate Planning" and "The 10 Biggest Mistakes Physicians Make Protecting Their Assets."

Mr. Diamond will also present information regarding "Myths of the Stock Market" and "Endowment Style Investing."

The program begins at 6:30 p.m. at the Corner Bistro, 9823-1 Tapestry Park Circle, Jacksonville, FL 32246. Dinner will follow the presentation.

If you are a physician and would like to attend, please RSVP to Amber Baker in our office at (904) 448-1969, or by email to ABaker@TheColemanLawFirm.net. Seating is limited so please RSVP as soon as reasonably possible.

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Tax Pitfall of Employer-Owned Life Insurance

What happens when a company loses its top salesperson to a tragic accident?  Imagine that the salesperson drove 40 percent of the company’s million-dollar-a-month revenue. Can the remaining, less experienced sales staff compensate for the loss?  Do the employees stick around if they have to take a temporary (but indefinite) cut in pay?  Can the owners find someone to replace their star salesperson?

Consider what might become of a valuable, two-owner company when one owner dies?  The remaining owner probably wants to purchase the shares from her former partner’s family, but does not have sufficient funds set aside. If the business value is not too high, the owner might be able to secure a loan to acquire the shares. What if the business is relatively new and is not yet creditworthy?  What if the operation fizzles out without the shareholder’s leadership and the surviving owner is left with a personal guarantee on a loan that she cannot pay?

 

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Hidden "Investment Income Tax" in Affordable Care Act

Now that the health care law has been declared constitutional, the remaining provisions will be going into effect. One little known provision is a new 3.8% investment income surtax, also called the health care surtax or the Medicare tax; it will go into effect on January 1, 2013. [1]

 

This new surtax will be assessed on the lesser of a) net investment income or b) the excess of modified adjusted gross income (MAGI) over the “threshold amount.” For married taxpayers filing jointly, the threshold amount is $250,000; married filing separately, $125,000; all other individual taxpayers, $200,000. For trusts and estates, it is the beginning of the top income tax bracket ($11,650 in 2012).

Stated another way: 1) If your modified adjusted gross income (MAGI) is less than or equal to the threshold amount that applies to you, you ...

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New Palm Coast Office for The Coleman Law Firm

We're excited to announce that we have opened a satellite office in Palm Coast to serve the growing Flagler County population.

The office location is 389 Palm Coast Parkway, SW, Suite 4, Palm Coast, Florida 32137. Our Palm Coast phone number is (386) 264-7250, or you can always reach us toll free at 1-888-492-2468.

We will offer our complete array of services: estate planning, wills and trusts, long term care planning, Medicaid asset protection planning, charitable planning, special needs trusts, probate and estate administration, trust administration, advance directives, including durable power of attorney, designation of health care surrogate and living wills, asset protection planning, and small business law dealing with limited liability companies, family limited partnerships, domestic asset protection trusts, and related matters.

Our 30+ years of experience can help you achieve peace of mind!
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Legal Issues Affecting Florida's Seniors - Free Lunch and Learn

We're co-sponsoring a free lunch and learn seminar on July 31, 2012 to talk about Elder law issues affecting Florida's seniors and the elderly.

Why the information you will learn at this seminar will be important to you: 

    1.   You will learn how to pay for long term care - either at home, in an assisted living facility, or skilled nursing home.
    2.   You will learn about Medicaid benefits for nursing home care, and how to qualify for those benefits, legally, without turning over all of your assets to the nursing home or the State of Florida.
    3.   You will learn about one of the most little known but significant benefits available to millions of veterans and their spouses to provide support for at home care, assisted living care, and even skilled nursing home care.
    4.   You'll also learn how to avoid probate and the costs and time associated with probate.

We’d like to offer you a free lunch and learn seminar!

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The Coleman Law Firm, PLLC

10161 Centurion Pkwy, N., Suite 310
Jacksonville, FL  32256
Phone: (904) 448-1969
Fax: (904) 448-5244
Email:
RColeman@
TheColemanLawFirm.net

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K. Mac Bracewell, Jr.

Jacksonville estate planning attorney Mac Bracewell
Mac Bracewell joined The Coleman Law Firm in June of 2012. Mr. Bracewell practices in the areas of estate planning, probate, trust administration, and guardianship. He represents clients with diverse needs, from those with small estates to those that demand sophisticated estate planning techniques such as drafting and funding irrevocable life insurance trusts,estate, gift and generation-skipping transfer tax planning, and forming family limited partnerships. He advises clients concerning planned charitable giving, asset protection, and choice of entity for business creation and succession planning. Mr. Bracewell looks forward to helping clients design and implement practical and innovative estate plans as well as guiding personal representatives through the probate process.

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