On June 11, 2014, Tanner Pittman volunteered as a pro bono attorney at the Lee County, Alabama, Sheriff's Department, drafting estate planning documents for officers.
The day-long event assisted 30 officers in drafting wills and other essential planning documents.
Credit is due to Samantha Copelan of Haygood, Cleveland, Pierce & Thompson, LLP for her efforts in coordinating the event in conjunction with State Bar representatives.
It is a time-honored rule of common law that parties are not usually compensated for emotional loss, and the rule is only overcome by statute, as in cases of severe emotional distress. Likewise, our land title law has so evolved to favor marketable, fee simple title, not family or emotional ties to land.
When it passed the new Uniform Partition of Heirs Property Act, effective June, 2013, the Georgia legislature bucked the common law and enshrined certain "subjective factors" for judges to consider when determining how to partition "heirs property" land.
I will not address the motivation for the new law. It is done better here in the Georgia Bar Journal and here in a College of William and Mary law review article. Suffice it to say, there are millions of acres in the South that are fractionally owned in such a way that the costs of consolidating the title are prohibitive for their owners. Ethnic minority owners of land are particularly affected because of historical economic hardship.
The new partition statute, however, may go too far in its attempts to correct these ills. In attempting to honor the importance and sentiment tied to land ownership, the law requires judges in partition actions to consider, among other factors, "whether the land has ancestral or sentimental value to heirs; whether a co-tenant would be harmed if not allowed to continue to use the property in the same manner following the conclusion of the action; . . . and other factors relevant to the court."
Adding such factors will make it difficult for attorneys and land owners or investors to know how a partition will turn out and is likely to have a chilling effect on important legal work to consolidate land title.
Economically, land is a capital resource, and society gains when it is put to its highest and most valuable use. Placing sentimental, subjective considerations into our land partition law may have the perverse effect of raising the costs to consolidation and efficient use of land and, thus, stunt economic growth in the region.
This firm also publishes content at the lawyer directory and rating site Avvo.com. Most recently, we posted a 16-step guide to petitioning for year's support in Georgia.
Year's support is the right of every surviving spouse or minor child of a deceased to inherit certain property from the estate, regardless of what is stated in the will. Attorneys have also used year's support as a strategic way of legally avoiding certain debts of the estate, ensuring a maximum tax break on certain real property of the estate, and quickly administering some intestate estates without the need for a full court-supervised administration and all of the complicated steps that can involve.
Tanner Pittman, LLC regularly advises clients and assists with petitions for year's support, year's support litigation, and other probate and estate matters.
The down-economy is a boon to estate planners for the affluent, reports the Wall Stree Journal.
The reason: low interest rates and depreciated assets.
For this post, consider low-valued assets in estate planning. The U.S. federal estate tax is actually a two-tiered system, resting on both estate and gift taxes. At least at present, the unified amount that one may give away in lifetime gifts or after-death bequests without facing taxation is $5 million.
When assets - such as stock or real estate - are depreciated, gifting is an exciting way to estate plan, especially if one supposes the assets may rebound in value in the future. The reason is that one can fit more assets under the $5 million threshold than one could in the past.
Suppose a simple cas where an individual is 70 years old and had $12 million in assets four years ago that are now worth $7 million. $5 million of those assets may be gifted to heirs now. In another five years, the equity and real estate markets may have digested the toxicity they're presently ailing from, and the $5 million may be worth $8 million. The individual has effetively gifted away with no tax hit far more than s/he could in better economic times.
Consider too that the estate and gift tax exclusion of $5 million is presently set to endure only until the end of 2012. After that time, it's anybody's guess where Congress will reset the threshold. But the smart bet is that, even if it's reset to $2 million, Congress will not retroactively declare that gifts during the 2011-2012 window taxable.
Low asset valuations, therefore, may have come at the ideal time for gifting to family. In two years, we may see high valuations and a low gift tax exclusion, effectivly closing the door on such aggressive gift planning for an indefinite amount of time.
Tanner Pittman, LLC is a West Georgia and Atlanta-area law firm specializing in estate planning and complex planning to avoid estate and gift taxation for affluent individuals and families.
The ABA reports today that the estate of Rosa Parks (of civil rights bus-riding fame) owes some $243,000 in legal fees to the two court-appointed lawyers handling it.
The fee amount was made public by a court filing in the Michigan Supreme Court seeking leave to appeal the order granting the fees.
Most publicly embarrassing, perhaps, to the two attorneys appointed is not the fee amount but the fact that they have acquired the intellectual property rights to use the Parks name in lieu of cash payment of a portion of their attorney fees.
The article appears to state that virtually all of the cash value of the estate has been used up in attorney fees. This Michigan case is yet another example of a rule that is true in Georgia as well: the relatively low cost of paying a competent estate planning attorney on the front end rather than the tens of thousands (or more) the heirs may lose in attorney fees after the testatrix dies.
Though they cost a substantial multiple of your average plumber's fee per hour, specialized estate planning attorneys often save a complex estate an amount of money that is several times greater than the planning attorney's fee.
The problem: How much do you trust your loved ones to care for a special-needs beneficiary of a will? Probably not this much:
A client recently retained me about a will in which almost all of the estate was left to the testatrix' daughter-in-law (we'll call her Tina). The will itself contained no instructions as to how Tina was to use the money, but she had assured the testatrix (whom we'll call Alice) she would use it to care for her (Alice's) handicapped son, Ben.
My client is Ben's cousin. She came to me with the question, "what can we do to make sure Tina uses this money on Ben's behalf?"
The answer: we have to be very, very creative. And we'll likely go to court over the question.
The reason: no amount of oral instructions or even writings outside your will can bind a recipient of property under that will as to how she (in this case, Tina) can use that property. As any law student can tell you: "the law does not countenance a gratuitous promise." In other words, promises are not legal contracts. Contracts only form when both sides of the bargain get something.
"But wait a minute," you might be saying. "Tina does get something here. She's getting a large inheritance when she wasn't even the testatrix' child."
And, unfortunately, that's wrong. Presuming Tina did promise to use the money on Ben's behalf, she's not getting anything other than the honor of being his trustee. (Leave aside for a moment the question of trustee's fees.) She was simply making a gratuitous promise. It wasn't "give me some money, and I'll take care of Ben." Rather, it was "put some money aside, and I'll give it all to Ben."
The lesson: As always, estate planning should not be done without the advice of a seasoned estate planner. Using Tanner Pittman, LLC's estate planning methods, the above problem would never have formed.
Tanner Pittman, LLC is a West Georgia law firm that specializes in estate services, civil litigation, and legal transactions.
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