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Articles Tagged with Kentucky

By Leah Morrison, Attorney
English, Lucas, Priest and Owsley, LLP

Leah Morrison

Leah Morrison, attorney

One of the most frequent reasons clients tell me they want to create a will, trust, or other estate documents is to avoid probate. People have come to see probate as an unduly burdensome process that can cost a lot of money and time, but in Kentucky, it’s not as bad as you might fear.

Before we delve into it, let’s take a moment to review what probate is. Probate is the legal process by which the financial affairs of a deceased person are concluded. It is a court supervised process in which assets are accumulated and distributed in accordance with the decedent’s will or pursuant to the statutory plan of descent, and debts are gathered for payment. Although, in Kentucky, the supervision provided by the court is often times very minimal.

While Kentucky’s probate laws are sufficient to ensure the deceased person’s assets are properly managed and distributed to the appropriate person, the requirements of the probate process are minimal enough that most people navigate it smoothly without incident.

The one thing, though, to know is that probate does make your will public. Your will becomes a public document that is recorded in the court system, and is available to anyone who wishes to view it.

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By Heather Coleman Brooks
Attorney, English, Lucas, Priest and Owsley, LLP

Heather Coleman Brooks

Heather Coleman Brooks

Death and taxes. Both inevitable, both made easier when a plan is in place. You deal with your taxes annually, but how often do you consider whether you have made the proper plans for your estate?

If you do not have substantial assets, you may be wondering if it is really necessary for you to have a will. To decide if it is right for you, consider what happens if you fail to make a plan.

In Kentucky, if you die without a will, your assets will pass according to the laws of intestacy. The courts will divide your assets among your heirs according to the priorities directed by Kentucky statutes. Sometimes, this has unintended consequences.

 

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By Leah Morrison, Attorney
English, Lucas, Priest and Owsley, LLP

trustsWhen it comes to planning to avoid or minimize Federal Estate tax, there are four (almost) magic words that frequently appear in trust documents: health, education, support and maintenance, known in the trust and estate law industry as HEMS. Outside of the tax advantages of including HEMS in a trust document, these words also impact the administration of the trust. When a trust includes HEMS language, beneficiaries from the trust may receive funds from the trust for those type of expenses, and those only.

A trustee is placed in charge of the trust. That trustee usually has broad latitude in determining how many distributions are made from the trust and in what amounts – but HEMS language is included to limit what those distributions may be used for. Trustees must ensure that the distributions fall under those categories. Trustees are often a lay person, and in many cases, a family member. This can make things particularly sticky and confusing, especially if there are disagreements among family members.

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By Nathan Vinson, Attorney
English, Lucas, Priest and Owsley, LLP

Improvements to tax law and reducing taxes are a very popular item on most politicians’ platforms. You won’t find anyone who openly says people should pay more. At least, not anyone currently serving in office.

They’re right, by the way – our tax code is far too cumbersome and it changes constantly. (And no, I’m not running for office.)

President Trump has indicated he wants to reform the tax code and change the way people pay taxes. Lawmakers are reportedly discussing how to do that while paying for expensive new initiatives. How can you do it all?

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By Nathan Vinson, Attorney
English, Lucas, Priest and Owsley, LLP

will

Prince performing in concert in Louisville, Kentucky. Photo by Bob Young.

It’s been more than a year since music legend Prince died unexpectedly at his home in Minnesota. He was actively touring and working at the time of his death on April 21, 2016, at the young age of 57.

You’re forgiven if you assumed his estate was long settled, since he died more than a year ago. But it’s not done yet – and may not be for quite a while – due to the fact that he died without a will.

It’s astounding to think that someone who is as famous, prosperous and with as many assets as Prince would die without this basic legal document. But as it turns out, he’s no different than anyone else – he probably didn’t want to think about death.

Whether you die a famous millionaire or with few assets, if you don’t have a Will you can leave a large mess. Heirs you would have never wanted to have your property could get it. Your estate will spend more probating your assets as well, and those who you wished to receive items from your estate may never see them.

Prince was a very charitable man, yet none of his millions he had nor future royalties will benefit those he likely would have preferred to benefit. Plus, the estate will shell out much more than anyone would want to pay in estate taxes.

Your children and family will be far happier if you take care of this before you die – and there’s no doubt it will bring you piece of mind, too.

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By Nathan Vinson, attorney
English, Lucas, Priest and Owsley, LLP

estate debtWhen a spouse, parent or child passes away, it’s incredibly difficult to handle. Beyond your own grief, planning the funeral and handling a thousand different tasks, you may receive calls or letters from creditors who try to convince you that you should pay the debt of the person who died.

In one recent case, a widow received a collection letter from an agency that specializes in collecting debt for creditors of deceased people. The estate had been closed for about a year. She didn’t owe that debt, but the collection agency tried to convince her that she did.

Collecting decedent debts

By law, you don’t owe a debt for someone who died (unless, of course, you owed the debt jointly with the decedent or as a guarantor). Once the person passes away and the proper steps have been taken to handle the probate estate, the opportunity for a creditor to collect unsecured debt is gone.

Credit agencies, especially the less reputable ones, may use all manner of intimidation and even threats to get people to pay debts. These calls can be troubling and confusing for people, especially those who are older or who don’t know the law. It’s important to understand how debt is collected to protect yourself and the people you love.

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By Nathan Vinson, Attorney
English, Lucas, Priest and Owsley, LLP

You’d think giving money away would be easy, wouldn’t you? And for the most part, it is. But it’s important to pay attention to some of the details so you don’t end up getting socked with a tax bill or missing out on a tax deduction in return for your generosity.

In our last post, we discussed how to give money to your children, grandchildren or anyone else you’d like without much complication (such as having to file a gift tax return).  Now, let’s turn to gifting that can net you a tax deduction on your income tax return (in addition to just making you feel good).

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By Nathan Vinson, Attorney
English, Lucas, Priest and Owsley, LLP

giftsIt’s a generous time of year.

There are donations making their way to non-profits, and checks being written in lieu of gifts to family members. If you prefer to give money rather than gifts to children, grandchildren or others on your list, there are a few things you need to know before you write that check.

We’ll address just giving to your children in this blog post; we’ll address giving to charities in part two later this month.

The main point: your gift can trigger your obligation to file a gift tax return if you aren’t careful. We’ll walk you through who you can give to, how you can give and how much you can give. Here’s the official information from the IRS.

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By Nathan Vinson, Attorney
English, Lucas, Priest and Owsley, LLP

will

Prince performing in concert in Louisville, Kentucky. Photo by Bob Young.

News reports since Prince’s death have indicated he died intestate – which means without a will. It’s hard to imagine someone who had complex dealings with the music world and a sizable fortune not having this very basic legal document.

You’re talking about a guy who changed his name to an unpronounceable symbol in a contract dispute with Warner Brothers (finally settled in 2014) and put out albums under the symbol name – and never seemed to lose credibility or popularity because of it. His cool factor really has nothing to do with legal issues. As a fellow musician, I just stand in awe of anyone who has such a long, productive career and had such a strong fan base that lasted decades.

Think of the legality of changing your name to a symbol and continuing to produce records. It probably gave his business and legal advisors some heartburn. Lawyers were likely involved in many aspects of his musical career, determining usage rights, negotiating record deals, negotiating with booking agents for venues and many, many other things. He had employees certainly and probably more than one business entity. It was a complex life.

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TAX DAY IS APRIL 18 ELPO

By Nathan Vinson, Attorney

English, Lucas, Priest and Owsley, LLP

Tax Day is a day that we know you celebrate with great abandon. Right?

If you do in fact go all out for Tax Day, this year, you’ll need to move your Tax Day celebrations to April 18. Traditionally, Tax Day is April 15. In some circumstances, it is moved back a few days to accommodate a holiday. This year, Tax Day is April 18 because of Emancipation Day, which is a holiday in Washington, D.C. that marks the anniversary of the abolition of slavery in the nation’s capital.  It is celebrated annually on April 16.  Because that date falls on a Saturday, Emancipation Day will be officially celebrated on April 15 this year, shutting down city offices.

Tax Day is also moved when April 15 falls on a Saturday or Sunday. It is then moved to the following Monday.

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