Tag: will planning
More than one in four (27%) UK adults hope to leave enough money for their family or pets to live comfortably after they’re gone.
The more specific stats are as follows:
- Enough for family or pets to live comfortably 27%
- Enough to boost child/grandchild’s savings 19%
- Enough for child/grandchild to put a deposit on a house 15%
- Enough to fund child/grandchild through university 11%
- Enough to fund child/grandchild’s wedding 7%
With respect to the composition of their expected estates, "nearly two thirds of UK adults expect to have a property (63%). Of those, 55% expect the value of the home they leave to be worth £100k or more. Over half (51%) expect to leave jewellery, antiques and paintings and nearly one in ten (9%) expect to leave a business behind."
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Listen to Strategies to Prevent Estate Litigation
This week on Hull on Estates, Natalia Angelini and Rick Bickhram discuss tools and strategies to prevent estate litigation.
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A Vanity Fair article published late last year writes on the relationship between playwright, Arthur Miller and his son, Daniel Miller who was born with Down Syndrome. Daniel was born in 1966 and institutionalized one week after being born and apparently while other family members kept in touch with Daniel, Miller rarely visited him or spoke of him.
When Miller died in February 2005, very few people knew of Daniel’s existence. Only one obituary notice mentioned Daniel and Miller’s own memoirs include no mention of Daniel.
Six weeks before his death, Miller made Daniel a full and direct heir equal to his other three children. While Daniel is not mentioned in the Will directly; separate trust documents, created the same day and sealed from public view, make Daniel an equal heir to Miller’s estate.
The article speculates that this was likely done contrary to legal advice as Miller’s bequest makes Daniel too wealthy to receive government assistance and a special trust was not created that would allow Daniel to inherit from the estate and continue to receive government assistance. In fact, Connecticut’s Department of Administrative Services issued a reimbursement claim to the estate for Daniel’s care since infancy and the estate is settling the claim.
Miller’s relationship with Daniel was complex and only Miller would be able to answer as to why he decided to make Daniel, who he did not publically acknowledge during his lifetime,an equal heir to his estate.
Recently departed actor Heath Ledger (A Knight’s Tale, Brokeback Mountain, The Dark Knight) left behind a young daughter. But based on news reports, Ledger appears to have neglected to include his daughter in his Will, perhaps unintentionally. It appears Ledger last filed a Will in 2003, before the birth of his daughter Matilda in 2005 and before his hit film Brokeback Mountain. This Will reportedly leaves Heath Ledger’s estate entirely to his father, mother and sisters, obviously with nothing to little Matilda.
Heath Ledger’s father Kim has stated that little Matilda "will be taken care of". However, Kim himself has been in litigation with his brothers, who accused him in 1994 of mishandling their grandfather’s estate to the extent of $2 million.
This intriguing story also illustrates the importance and difficulty of valuing an estate. News reports contain estimates from $2.5 million to $20 million, quite a range for an estate that spans at least two countries.
No word yet on whether litigation will be launched on little Matilda’s behalf against her exclusion from her father’s estate. Of course, other Wills may emerge…
In “Will Planning for Canadian Residents with U.S. Connections”, presented at the 9th Annual Estates and Trusts Summit, Paula Ideias, Bryan McNulty and Beth Webel (PricewaterhouseCoopers LLP) provide a sobering summary of problems with cross-border joint tenancy assets:
For U.S. estate tax purposes, when there is a spousal joint tenancy and the surviving spouse is not a U.S. citizen, the entire value of jointly held property is included in the decedent’s gross estate unless the executor submits facts sufficient to show that the property was not acquired entirely with consideration furnished by the decedent, or was acquired by the decedent and the other joint owner by gift, bequest or inheritance.
Canadian income tax consequences should also not be ignored. If the joint tenancy is between spouses, the deemed disposition of the property at death will not occur until the death of the second spouse. This may result in foreign tax credit problems if U.S. estate tax is triggered on the first spouse’s death. If there is a gain on the property, it may be best to elect out of the spousal rollover at the time of the first spouse’s death.
As a result, joint ownership is not a recommended form of ownership for U.S. situs property or as a will substitute for property subject to U.S. estate and gift tax because the incidents of Canadian income tax and U.S. estate and gift tax may not apply at the same time or in the hands of the same taxpayer. In this case, it is very likely that double taxation will arise. Additionally, joint ownership may not allow the spouses to undertake effective will and estate planning for U.S. estate tax. (see pg. 4).
The planning process is becoming increasingly complex, particularly where there are cross-border assets involved. In almost any situation involving US assets, it may be worth obtaining specialist legal advice in the State in question.
Thanks for reading.