Even though a wealthy family put assets in a trust for their children in order to protect them from creditors, a child’s interest in the trust could be divided in a divorce, says the Massachusetts Appeals Court. While this result is unusual, it goes to show that even a solid spendthrift trust might not be perfect if a creditor – in this case, a spouse – is sympathetic enough. Curt Pfannenstiehl was a beneficiary of a

Stockbrokers, financial planners and insurance agents who provide advice regarding IRAs and other retirement accounts will have new responsibilities toward clients, and the way they bill their clients may change, under new rules announced by the U.S. Labor Department. Under the rules, advisors must now act in their clients’ best interests when they make recommendations. In the past, many advisors merely had to make recommendations that were “suitable” for a client, even if what they recommended

Executors who have to file a federal estate tax return, and some heirs who receive assets from an estate that is subject to the federal estate tax, may be facing a significant new problem as a result of rules just issued by the IRS. The problem only affects larger estates – generally those where the deceased person’s assets, large lifetime gifts, and life insurance proceeds total more than $5.45 million. But for those estates, it’s a

If you inherited a retirement account, and if the estate of the person you inherited it from owed an estate tax, you might be missing a big income tax deduction when you withdraw funds from the account. Many people forget to claim this deduction. The deduction applies not only to inherited IRAs, but also to inherited 401(k) accounts, certain stock options and unpaid dividends, pretax gains in certain annuities, and some other assets. The idea is

Did you know that it may be possible to avoid paying immediate capital gains taxes when you sell an investment property? That’s true if you’re planning to sell the property and invest the proceeds in another property shortly afterward. For instance, suppose you own a condo as an investment, and you plan to sell it and use the proceeds to buy another investment property. You might be able to treat the sale and the subsequent purchase

The Federal Reserve has begun raising interest rates. And while rates are still historically extremely low, they’re probably at the start of a long, gradual increase. As a result, you might want to consider some estate planning techniques now that benefit from very low rates … because an opportunity like this one might not come around again for many, many years. Here are some ways to use the current low-rate environment to transfer assets to your

Did you know that 47% of people over age 85 are affected by Alzheimer’s disease? The numbers are high enough that any older person planning for their estate should consider the possibility that they may become intellectually incapacitated at some point. Of course, a critical step in planning for incapacity is having a durable power of attorney document in place that allows someone to handle your financial affairs if you’re no longer able to do so.

When actress Audrey Hepburn died in 1993, she owned a storage locker containing memorabilia of her career – costumes, photos, awards, scripts, posters and the like. In her will, she directed that the contents be divided equally between her two sons. But some 22 years later, the two sons (who had different fathers) still can’t agree on how to divide the goods. The older son, who is now in his mid-fifties, has filed a lawsuit and

IRS officials have been indicating for a few months now that they’re about to start cracking down on certain estate planning techniques that have been popular in recent years. But ironically, this might actually help a number of clients to save on their taxes. The issue involves family limited partnerships and LLCs. A technique that many wealthy people have used in the past is to create a family business structure of this type, and then give