The Estate Planner - Thomson Reuters



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|March 2011 | | |

|IN THIS ISSUE: | |The Estate Planner Archive |

| | | |

|News, Articles, and Updates for the Estate Planner | |Cowles Resources |

|See updates and article references involving charitable trusts and donations;| |Order Cowles and Supplies |

|elder law, estate and gift taxes, estate and trust administration/probate; | |Cowles Members Only |

|estate planning; generation-skipping transfer tax; health care; interest; | |Westlaw |

|retirement; same-sex marriage/civil unions/domestic partnerships; small and | | |

|mid-size law firm practice; special needs trusts/ guardianships, trusts; and | |Contact Us |

|wills. | |E-Mail the Editor |

| | | |

|Cowles Tech Tip | |Other Resources |

|Version 2011-1 of Trust Plus and TrusTerminator is now available. | |Other Reference Material |

| | |Other Newsletters |

|The CD version of the release will be mailed to customers in the near future,| | |

|but you can also install it today by downloading it directly from Members | | |

|Only. | | |

| | | |

|This Tech Tip highlights the new additions and improvements you'll find in | | |

|this release of Trust Plus and TrusTerminator, including updated options and | | |

|language for the 2010 Tax Relief Act, a new IRA trust module, and new | | |

|customizable register and trust accounting reports, and more. | | |

| | | |

| | | |

|See all articles in this issue |

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|NEWS, ARTICLES, AND UPDATES |

|For The Estate Planner |

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|Charitable Trusts and Donations |

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|OTHER |

|Minnesota. State Enacts Legislation Conforming Tax Provisions to Federal Tax Changes Made in 2010. On March 21, Minnesota Gov. |

|Mark Dayton signed a bill (H.F. 79) that brings most of the state’s tax provisions into conformity with the federal tax changes |

|made in 2010. Conforming changes include extending the authority for individuals age 70 1/2 and older to transfer up to $100,000 |

|from an IRA or Roth IRA directly to a qualified charity and extending the increase in the federal AGI limit on the amount of |

|qualified conservation easements that may be claimed as a charitable deduction. The decision to conform to federal changes is |

|only effective for tax year 2010. Westlaw: 2011 MN H.F. 79, Minnesota 87th Legislative Session (March 21, 2011); Web: H.F. 79, |

|Minnesota 87th Legislative Session (March 21, 2011). |

|Oregon. State Enacts Legislation Conforming Tax Provisions to IRC. On March 9, Oregon Governor John Kitzhaber signed legislation |

|(S.B. 301) that conforms many of its tax provisions to the Internal Revenue Code as in effect on December 31, 2010. An internet |

|notice posted by the Oregon Department of Revenue lists both provisions that are “connected” to federal law and those that are |

|“disconnected”. Among those listed that conform to federal provisions are tax-free distributions from IRAs for charitable |

|purposes and contributions of capital gain property for conservation purposes. Westlaw: 2011 OR S.B. 301 (NS), Oregon 76th |

|Legislative Assembly (March 9, 2011); Web: S.B. 301, Oregon 76th Legislative Assembly – 2011 (March 11, 2011); Oregon Disconnect |

|from Federal Law: 2010, Oregon DOR (March 10, 2011) |

|AHP. Survey Examines Effect of Administration’s Proposed Changes to Tax Incentives for Charitable Giving. Recently, the |

|Association for Healthcare Philanthropy issued its recent survey results on the impact of proposed changes to tax incentives for |

|charitable giving in The Effect of Proposed Changes to Charitable Gift Tax Deductibility on Health Care Philanthropy. The survey |

|is in response to the U.S. Administration’s National Commission on Fiscal Responsibility and Reform’s December 1, 2010 deficit |

|reduction proposal in which it recommends significantly reducing tax incentives for charitable giving to a 12% tax credit for |

|giving above 2% of AGI. According to the report the vast majority of respondents said that the proposed changes will negatively |

|affect their fundraising programs. Westlaw: 051 DER G-5, 2011, 2011 WL 881287 (March 16, 2011); Web: The Effect of Proposed |

|Changes to Charitable Gift Tax Deductibility on Health Care Philanthropy, AHP (March 2011). |

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|Elder Law |

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|LEGISLATION |

|Kentucky. Civil Remedies For Exploitation of an Adult; The Elder And Vulnerable Victims Trust Fund Created. Kentucky has passed |

|legislation establishes an elder and vulnerable victims trust fund to provide funding for programs combating elder and vulnerable|

|adult abuse, neglect, or financial exploitation. The legislation also adds the commission of a felony under KRS Chapter 209 to |

|offenses that trigger an offender's forfeiture of the right to inherit property from the victim of the offense, and directs that |

|any escheated property be directed to the elder and vulnerable victims trust fund. A civil remedy with treble damages for use |

|against persons who are convicted of exploitation of an adult and fail to return the victim's property within 30 days of an order|

|by the sentencing court to do so is also added to KRS 209.990. (2011 Kentucky House Bill No. 52, Kentucky 2011 Regular Session; |

|Title: An Act Relating To Elder And Vulnerable Adult Abuse, Neglect, And Financial Exploitation And Making An Appropriation |

|Therefor., VERSION: Enrolled). Westlaw: 2011 KY H.B. 52 (NS); Web: Kentucky Legislature. |

|Virginia. Real Estate Tax Relief For The Elderly And Permanently And Totally Disabled. Virginia has passed legislation providing |

|for real estate tax relief for the elderly and permanently and totally disabled. The act authorizes local governments to |

|establish annual income or financial worth limitations as a condition of eligibility for real property tax relief for the elderly|

|and permanently and totally disabled. The law implements the amendment to Article X, Section 6 (b) of the Constitution of |

|Virginia that limits the General Assembly's ability to establish the limitations and allows the General Assembly to authorize |

|local governments to establish the limitations. (2010 Virginia House Bill No. 2278, Virginia 2011 Regular Session; Title: Real |

|Estate Tax; Relief For Elderly And Permanently And Totally Disabled., VERSION: Adopted). Westlaw: 2010 VA H.B. 2278 (NS); Web: |

|Virginia Legislature. |

|West Virginia. Financial Exploitation of the Elderly, Protected Persons and Incapacitated Adults. West Virginia has passed |

|legislation relating to crimes against the elderly, protected persons or incapacitated persons. The law addresses financial |

|exploitation of the elderly, protected persons and incapacitated adults in misappropriating or misusing assets; permits the |

|prosecutor to cumulate amounts or values when charging; permits banking institutions and others to report suspected financial |

|exploitation to law-enforcement authorities and other entities; permits financial institutions to disclose suspicious activity |

|reports or currency transaction reports to the prosecuting attorney; provides civil immunity for reporting; orders restitution; |

|and establishes the criminal penalty of larceny. (2011 West Virginia House Bill No. 2362, West Virginia Eightieth Legislature - |

|Regular Session, 2011; Title: Increasing Penalties For Financial Exploitation Of An Elderly Person Or Incapacitated Adult, |

|VERSION: Enrolled). Westlaw: 2011 WV H.B. 2362 (NS); Web: West Virginia Legislature. |

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|OTHER |

|U.S. Tax Court. Payments to Wife’s Caregiver Not Deductible Business Expenses by Self-employed Husband. On March 1, the U.S. Tax |

|Court disallowed business-expense deductions Joseph Kuntz III and Syrita Kuntz claimed for amounts they paid to a caregiver for |

|Mrs. Kuntz, who has Alzheimer’s disease, beyond the payment for clerical work performed by the caregiver for Mr. Kuntz time and |

|marble business. Mr. Kuntz argued that he had to employ someone to look after his wife while he was at work since she could not |

|stay by herself, but the court said that the expense of caring for her is not deductible under I.R.C. § 162 since it is not an |

|ordinary and necessary expense of carrying on a trade or business even though it allowed Mr. Kuntz to work outside the home. |

|However, the couple is entitled to medical-expense deductions under I.R.C. § 21, which allows a taxpayer a credit for a |

|percentage of the expenses of caring for a spouse who is “physically or mentally incapable of caring for himself or herself and |

|who has the same principal place of abode as the taxpayer” if “such expenses are incurred to enable the taxpayer to be gainfully |

|employed”. Westlaw: Kuntz v. Commissioner, T.C., No. 7691-09, T.C. Memo. 2011-52, 2011 WL 701451, U.S.Tax Ct., 2011 (March 1, |

|2011); Web: Kuntz v. Commissioner, T.C., No. 7691-09, T.C. Memo. 2011-52, U.S.Tax Ct., 2011 (March 1, 2011) |

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|Estate and Gift Taxes |

| |

|ARTICLES |

|Control at What Cost? Annual Exclusion Gifts and Present Interests. Hugh F. Drake. (Probate and Property, March/April, 2011). |

|Westlaw: 25-APR Prob. & Prop. 36. |

|Indiana Inheritance Tax Impact of Formula Clause Fix. Tracey A. Anderson, Jerome Margraf. (Res Gestae, March, 2011). Westlaw: |

|54-MAR Res Gestae 17. |

|The Return of the ‘Death Tax’. Mellany L. McDonald. (Houston Lawyer, January/February, 2011). Westlaw: 48-FEB Hous. Law. 24; Web:|

|Houston Lawyer. |

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|IRS DECISIONS, REGULATIONS, AND GUIDANCE |

|IRS. IRS Pushes for Release of Property Transfer Records to Identify Noncompliant Gift Tax Filers. In an ex-parte petition dated |

|December 27, 2010 filed with the U.S. District Court for the Eastern District of California, the U.S. Department of Justice asked|

|for leave to serve an IRS “John Doe” summons on the State of California Board of Equalization that requires the board to turn |

|over property transfer records filed by taxpayers who, between 2005 through 2010, transferred real property in California for |

|little or no consideration. According to a declaration by Josephine Bonaffini, the Federal/State Coordinator for the IRS Estate |

|and Gift Tax Program, filed with the petition, for the past 18 months the IRS has been examining nationwide records of taxpayers |

|who transferred real property for little or no consideration to related family members and did not report these transactions on a|

|Form 709. The IRS has already received information from Connecticut, Florida, Hawaii, Nebraska, New Hampshire, New Jersey, New |

|York, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Virginia, Washington, and Wisconsin, but the California Board of |

|Equalization has stated that it cannot provide similar information without a summons due to the restrictions of Cal. Civ. Code § |

|1798.24. Westlaw: Ex Parte Petition, 2011 WL 1090095, Declaration, 2011 WL 1090097, Memo in Support of Petition, 2011 WL 1090096 |

|(March 28, 2011); Web: In Re the tax liabilities of John Does, E.D. Cal., No. 2:10-mc-00130-MCE-EFB, filed 12/27/10. (Information|

|about this case is available on the U.S. Court's PACER system. A subscription to PACER is required.) |

|IRS. IRS Art Advisory Panel Find Over Half of Art Misvalued for Charitable Donation or Estate Purposes. The Art Advisory Panel to|

|the IRS stated in its Annual Summary Report for 2010 over half of the artwork the panel reviewed that was received as a gift or |

|as part of an estate or that had been donated to charity was not valued correctly in 2010, resulting in an underpayment of taxes.|

|Of the misvalued items, the Panel determined that charitable contribution claims were overvalued by 58 percent and that estate |

|and gift tax appraisals were undervalued by 43 percent. The report noted that all cases selected for audit that include art work |

|or cultural property with a claimed value of $20,000 or more must be referred to Art Appraisal Services for review by the |

|Commissioner's Art Advisory Panel when applicable. Westlaw: 044 DER G-4, 2011, 2011 WL 756601 (March 7, 2011); Web: The Art |

|Advisory Panel of the Commissioner of Internal Revenue Annual Summary Report for 2010, IRS Publications (March 5, 2011). |

|IRS. IRS Requests Public Comment on Form 8939. The IRS is soliciting comments from the general public on Form 8939, Allocation of|

|Increase in Basis for Property Acquired from a Decedent. I.R.C. § 6018 requires the form to be filed by an executor if the fair |

|market value of all non-cash property acquired from decedent is more than $1.3 million; for nonresident decedents who are not |

|U.S. citizens , if the fair market value of tangible property in the U.S. and other property acquired from decedent by a U.S. |

|person is greater than $60,000; or if appreciated property is acquired from decedent that decedent acquired by gift within three |

|years of death and a gift tax return was required on the transfer to decedent. Written comments are due to Allan Hopkins, |

|Internal Revenue Service, Room 6129, 1111 Constitution Avenue, NW., Washington, DC 20224 by May 6, 2011. Westlaw: 76 FR 12416-02,|

|2011 WL 766486 (March 7, 2011); Web: 76 FR 12416-02, GPO (March 7, 2011). |

|IRS. Section 2056 - Bequests, etc., to Surviving Spouse (Marital Deduction v. No Marital Deduction). The IRS ruled that the QTIP |

|election made for a family trust was null and void for purposes of §§ 2044, 2056(b)(7), 2519 and 2652 after it was determined |

|that after funding the Marital Trust, the QTIP election made for the Family Trust was not necessary to reduce the estate tax |

|liability to zero because there was no estate tax liability whether or not the election was made. Westlaw: PLR 201112001, 2011 |

|WL 1097111 (March 25, 2011); Web: PLR 201112001, IRS Written Determinations (March 25, 2011). |

|IRS. Section 2523 - Gift to Spouse (Marital Deduction Allowed v. Not Allowed). In this ruling the IRS revoked PLR 201025021 |

|retroactive to February 19, the date of issue. In the original ruling the Service had granted taxpayer an extension of time to |

|make an inter vivos QTIP election under I.R.C. § 2523(f)(4) for transfer of stock to a trust for the benefit of taxpayer’s |

|spouse. However, the Service now says it has determined that the ruling was in error and not in accord with the current views of |

|the Service. Westlaw: PLR 201109012, 2011 WL 759595 (March 4, 2011); Web: PLR 201109012, IRS Written Determinations (March 4, |

|2011). |

|IRS. Section 2032 - Alternate Valuation. In this ruling the IRS reconsidered its position in PLR 201033023 (May 19, 2010) in |

|which it had denied an extension of time to make the alternate valuation election, and now concludes that the estate meets the |

|requirements for relief, thus granting a 120-day extension for the estate to make the alternate valuation election under I.R.C. §|

|2032. Westlaw: PLR 201109014, 2011 WL 759597 (March 4, 2011); Web: PLR 201109014, IRS Written Determinations (March 4, 2011). |

|IRS. Section 9100 - Extension of Time for Making Certain Elections. The IRS has granted decedent's estate a 120-day extension to |

|make a “reverse” QTIP election under I.R.C. § 2652(a)(3) for an Exempt QTIP Trust and to allocate his GST exemption to the Exempt|

|QTIP Trust and the Credit Shelter Trust after the attorney who prepared the Form 706 failed to make the proper election and |

|allocations. Westlaw: PLR 201109016, 2011 WL 759599 (March 4, 2011); Web: PLR 201109016, IRS Written Determinations (March 4, |

|2011). |

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|LEGISLATION |

|Virginia. Formula Clauses Referring to Federal Estate and Generation-Skipping Transfer Tax Laws. Virginia has passed legislation |

|relating to formula clauses referring to federal estate and generation-skipping transfer tax laws in wills and trusts. The Act |

|amends a section added to the Code during the 2010 Session that was designed to address the consequences of the anticipated |

|repeal of the federal estate and generation-skipping transfer taxes with respect to estates and taxable transfers occurring in |

|2010, and the retroactive reinstatement of such taxes as well as other changes made to federal tax law. The act provides that the|

|decision by a decedent's personal representative not to have the estate tax apply to a decedent's estate in 2010 does not affect |

|the meaning of formula clauses for calculating transfers or devises based on federal estate or generation-skipping transfer tax |

|law contained in a will or other instrument. In addition, the legislation provides that the fiduciaries or beneficiaries of an |

|estate may petition the court to determine how the decedent would want such formula clauses construed, and may also enter into a |

|nonjudicial agreement regarding the construction of such clauses. The act is effective immediately. (2010 Virginia Senate Bill |

|No. 1423, Virginia 2011 Regular Session; Title: Wills & Trusts; Formula Clauses Referring To Federal Estate & Generation-Skipping|

|Transfer Tax Law., VERSION: Enrolled). Westlaw: 2010 VA S.B. 1423 (NS); Web: Virginia Legislature. |

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|OTHER |

|CRS. CRS Issues Report on Major Tax Proposals in President's FY 2012 Budget Proposal. On March 17, the Congressional Research |

|Service issued a report “An Overview of Major Tax Proposals in the President's FY2012 Budget,” which provides a broad overview of|

|the provisions included in the President Obama's budget proposal released in February. Included in the proposal is a return to |

|the estate and gift tax parameters that were in place in 2009 for decedents dying in 2013 and beyond, and permanent “portability”|

|of the deceased spouse’s unused exemption amount to the surviving spouse. Additional modifications to the estate tax would affect|

|“restrictions” on assets when determining valuation discounts and popular tax planning techniques involving grantor annuity |

|trusts and generation skipping transfers. [Congressional Research Service reports are not directly available to the public. The |

|reports are made public through requests to Members of Congress. Secondary sources include online legal services, like BNA's |

|Taxcore documents available on Westlaw (this report is 11 NO. 054 BNA Taxcore 029 (March 21, 2011). Incomplete collections also |

|exist on the web, often collected by subject. See ]. |

|JCT. JCT Issues Estimates for Revenue Provisions in President's FY 2012 Budget Proposal. On March 17, the Joint Committee on |

|Taxation issued its estimates on the effect of President Obama’s budget proposal released in February on revenues. Included in |

|the report are estimates on the impact of extending the 2009 parameters on estate, gift, and generation-skipping transfer taxes, |

|modification of estate and gift tax valuation discounts, and proposed reforms to grantor retained annuity trusts and generation |

|skipping transfers. Westlaw: JCX-19-11, 2011 WL 914593 (March 18, 2011); JCX-19-11, Joint Committee on Taxation (March 17, 2011).|

|U.S. Tax Court. Court Finds Decedent Did Not Retain Life Estate in Residence, Value Properly Excluded from Estate. On March 15, |

|the U.S. Tax Court held that the decedent, Sylvia Riese, did not retain a life estate in the residence she had transferred to a |

|qualified personal residence trust that terminated 6 months before her death even though she continued to live in the property, |

|paying associated expenses but not rent, as there was no express or implied understanding that she could occupy the residence |

|rent free. Therefore, the value of the residence was properly excluded from Reise’s gross estate on Form 706. The court also said|

|that the accrued rent during her occupancy after the QPRT terminated is deductible as a debt under I.R.C. § 2053, but that |

|neither unpaid rent on the residence by the estate during administration nor investment management fees paid by the estate to |

|decedent’s son-in-law are deductible as administrative expenses under I.R.C. § 2053. Westlaw: Estate of Riese v. C.I.R., T.C. |

|Memo. 2011-60, 2011 WL 94746, U.S.Tax Ct., 2011 (March 15, 2011); Web: Estate of Riese v. C.I.R., T.C. Memo. 2011-60, U.S.Tax |

|Ct., 2011 (March 15, 2011). |

|U.S. District Court. Court Upholds Charitable Deduction of $11.7 Million to Trust. On March 9, the U.S. District Court for the |

|Western District of Pennsylvania ruled that the Estate of Antonio Palumbo is entitled to a charitable deduction of $11.7 million,|

|which was paid from the estate to a charitable trust created by the decedent during his lifetime. Mr. Palumbo had executed |

|various wills during his lifetime that transferred his residuary estate to a charitable trust, but his latest will did not |

|include a residuary provision "due to a scrivener's error on the part of Mr. Palumbo's attorney." The IRS had argued that since |

|payment was made to the charitable trust pursuant to a settlement agreement between Mr. Palumbo's son and intestate heir and the |

|trust, the amount was not paid by operation of a residuary clause in the will, and thus, could not be claimed as a charitable |

|deduction from the estate. Westlaw: Estate of Palumbo v. United States, W.D. Pa., No. 10 cv0760, 2011 WL 824030 (March 9, 2011); |

|Web: Estate of Palumbo v. United States, W.D. Pa., No. 10 cv0760 (March 9, 2011) (Information about this case is available on the|

|U.S. Court's PACER system. A subscription to PACER is required.) |

| |

|Estate and Trust Administration; Probate |

| |

|ARTICLES |

|Designating the Application of Another State's Laws in a Trust. The Private Clients, Trusts and Estates Group of Schiff Hardin |

|LLP. (Estate Planning, April, 2011). Westlaw: 38 ESTPLN 40. |

|Disinheritance of Minor Children: a Proposal to Amend the Uniform Probate Code. Jacqueline Asadorian. (Boston College Third World|

|Law Journal, Winter, 2011). Westlaw: 31 B.C. Third World L.J. 101. |

|Gathering and Preserving Information from the Outset in Probate Litigation. Carl A. Aveni, II. (Ohio Probate Law Journal, |

|January/February 2011). Westlaw: 21 No. 3 Ohio Prob. L.J. 4. |

|Specialization in Estate Planning, Trust and Probate Law. Donald G. Schweller. (Ohio Probate Law Journal, January/February 2011).|

|Westlaw: 21 No. 3 Ohio Prob. L.J. 6. |

| |

|LEGISLATION |

|Idaho. Intestate Succession And Wills. Idaho has passed legislation concerning intestate succession. The act amends existing law |

|relating to intestate succession and wills to revise the time frame for filing a disclaimer under certain circumstances; and to |

|remove outdated provisions. (2011 Idaho Senate Bill No. 1121, Idaho Sixty-First Idaho Legislature, First Regular Session - 2011; |

|Title: Intestate Succession, Wills, VERSION: Adopted). Westlaw: 2011 ID S.B. 1121 (NS); Web: Idaho Legislature. |

|Idaho. Trustees; Equal Value Of Substituted Property. Idaho has passed legislation that adds to existing law relating to trusts |

|and fiduciaries to provide for the fiduciary duty of trustees to determine equal value of substituted property. (2011 Idaho |

|Senate Bill No. 1045, Idaho Sixty-First Idaho Legislature, First Regular Session - 2011; Title: Trusts And Fiduciaries, VERSION: |

|Adopted). Westlaw: 2011 ID S.B. 1045 (NS); Web: Idaho Legislature. |

|Idaho. Personal Representative Transactions and Powers of Conservators in Administration under Uniform Probate Code. Idaho has |

|passed legislation that amends existing law relating to the Uniform Probate Code to revise transactions authorized for personal |

|representatives; and to revise powers of conservators in administration. The law amends Idaho Code §§ 15-3-715 and 15-5-424. |

|(2011 Idaho Senate Bill No. 1044, Idaho Sixty-First Idaho Legislature, First Regular Session - 2011; Title: Uniform Probate Code,|

|Conservators, VERSION: Adopted). Westlaw: 2011 ID S.B. 1044 (NS); Web: Idaho Legislature. |

|South Carolina. Certain Reporters Comments Added to 2010 Probate Code Amendments. South Carolina has passed legislation that |

|directs the South Carolina Code Commissioner to include Reporters Comments in various provisions of the South Carolina Probate |

|Code, beginning with the 2011 Cumulative Supplement To The Code Of Laws Of South Carolina, 1976. The reporters notes are from the|

|2010 amendments to the code (Act 244 of 2010), which did not have the reporter notes available when publishing those amendments. |

|(2011 South Carolina Senate Bill No. 213, South Carolina One Hundred Nineteenth Session General Assembly - First Regular Session;|

|Title: An Act To Direct The South Carolina Code Commissioner To Include Beginning With The 2011 Cumulative Supplement To The Code|

|Of Laws Of South Carolina, 1976, Certain Reporter's Comments In Regard To Various Provisions Of The South Carolina Probate Code |

|In, VERSION: Adopted). Westlaw: 2011 SC S.B. 213 (NS); Web: South Carolina Legislature. |

|South Dakota. Trust Provisions Amendments; Certificate of Trust Changes. South Dakota has passed legislation that revises various|

|trust provisions, including the liability of excluded fiduciaries, trust protectors, trust advisors, and changes to the statutory|

|certificate of trust form. (2011 South Dakota House Bill No. 1155, South Dakota Eighty-Sixth Legislative Assembly, 2011; Title: |

|Revise Various Trust Provisions., VERSION: Adopted). Westlaw: 2011 SD H.B. 1155 (NS); Web: South Dakota Legislature. |

|Utah. Definitions Used For Governing Instruments In Probate. Utah has passed legislation that clarifies definitions used for |

|governing instruments in probate. The act includes specific cross-references to existing definitions for governing instruments |

|and provides how specific terms used in a governing instrument control how property is divided. (2011 Utah Senate Bill No. 104, |

|Utah Fifty-Ninth Legislature - 2011 General Session; Title: Probate Law Amendments, VERSION: Adopted). Westlaw: 2011 UT S.B. 104 |

|(NS); Web: Utah Legislature. |

| |

|Estate Planning (Generally) |

| |

|ARTICLES |

|A Beneficiary Serving as Trustee May Affect Asset Protection. Kenneth W. Kingma. (Estate Planning, April, 2011). Westlaw: 38 |

|ESTPLN 22. |

|Chronic Illness; Practical Planning and Drafting, Part 2. Martin M. Shenkman, Joshua Rubenstein. (March/April, 2011, Probate and |

|Property). Westlaw: .25-APR Prob. & Prop. 48. |

|Control at What Cost? Annual Exclusion Gifts and Present Interests. Hugh F. Drake. (Probate and Property, March/April, 2011). |

|Westlaw: 25-APR Prob. & Prop. 36. |

|Defining 'Descendants': Science Outpaces Traditional Heirship. David Shayne and Christine Quigley. (Estate Planning, April, |

|2011). Westlaw: 38 ESTPLN 14. |

|Estate Planning and Title Insurance. Brian J. Jereb. (Ohio Probate Law Journal, January/February 2011). Westlaw: 21 No. 3 Ohio |

|Prob. L.J. 5. |

|From Zoom to Doom? Risks of Do-It-Yourself Estate Planning. Wendy S. Goffe and Rochelle L. Haller. (Estate Planning, April, |

|2011). Westlaw: 38 ESTPLN 27. |

|Specialization in Estate Planning, Trust and Probate Law. Donald G. Schweller. (Ohio Probate Law Journal, January/February 2011).|

|Westlaw: 21 No. 3 Ohio Prob. L.J. 6. |

|Stress Test Life Insurance Now to Avoid Future Heartache. Richard M. Weber and Gordon A. Schalle.r (Estate Planning, April, |

|2011). Westlaw: 38 ESTPLN 3. |

| |

|LEGISLATION |

|Montana. Uniform Power Of Attorney Act Adopted. Montana has passed legislation revising laws relating to powers of attorney, |

|including adopting the Uniform Power Of Attorney Act to replace the Statutory Form Power Of Attorney Act. The law also provides |

|causes of actions and penalties for the intentional dissipation of an estate through the use of a power of attorney. (2011 |

|Montana House Bill No. 374, Montana Sixty-Second Legislature - 2011 Session; Title: Implement The Uniform Power Of Attorney Model|

|Law, VERSION: Enrolled). Westlaw: 2011 MT H.B. 374 (NS); Web: Montana Legislature. |

|West Virginia. Amendments to Trusts and Estates Provisions; Adopting West Virginia Uniform Trust Code. West Virginia has passed |

|legislation relating generally to estates and trusts and their administration, and providing that certain provisions of current |

|law to have no effect after specified date. The act changes names of certain articles of existing code; provides for the |

|creation, administration, revision and termination of trusts; provides for trustees, powers and duties of trustees and |

|substitution of trustees; provides for distribution of trust assets; specifies powers and certain restrictions on powers of |

|fiduciaries; amends the Uniform Prudent Investor Act; and modernizes language of certain existing sections of code and deleting |

|obsolete language. The law adopts the West Virginia Uniform Trust Code; providing general provisions and definitions; judicial |

|proceedings; representation of trusts; creation, validity, modification and termination of trusts; creditor's claims; spendthrift|

|trusts, discretionary trusts and revocable trusts; the office of trustee; duties and powers of trustees; liability of trustees |

|and rights of persons dealing with trustee; and various miscellaneous provisions for trusts and trustees. In addition, there is a|

|delayed effective date for West Virginia Uniform Trust Code and providing rules for application of that date. (2011 West Virginia|

|House Bill No. 2551, West Virginia Eightieth Legislature - Regular Session, 2011; Title: Relating Generally To Estates And Trusts|

|And Their Administration, VERSION: Enrolled). . Westlaw: 2011 WV H.B. 2551 (NS); Web: West Virginia Legislature. |

| |

|Generation-Skipping Transfer Tax |

| |

|ARTICLES |

|BNA. Attorneys Request IRS Guidance on Automatic Allocation of GST after 2010 Tax Relief Act Assigns Zero Tax Rate for 2010. The |

|2010 Tax Relief Act reinstated the generation skipping transfer tax assigning it a zero percent tax rate for 2010. This has led |

|to questions by practitioners as to whether transferors who make a direct skip in 2010 will have to elect out of the automatic |

|allocation of GST exemption by the gift tax return due date of April 18, which can be extended until Oct. 15, or if the return |

|due date is automatically extended until Sept. 19, said Carol Harrington, a partner with McDermott, Will & Emery in an interview |

|with BNA on March 16. According to BNA’s report, estate tax attorneys have asked the Treasury Department to issue formal guidance|

|that will clarify that the GST Tax exemption will not be automatically allocated where there can be no benefit. Westlaw: 052 DER |

|G-4, 2011, 2011 WL 898425 (March 17, 2011). |

| |

|IRS DECISIONS, REGULATIONS, AND GUIDANCE |

|IRS. Section 9100 - Extension of Time for Making Certain Elections. The IRS granted donor and his spouse a 120-day extension to |

|allocate his and her respective GST exemptions to one-half of the entire value of the amounts transferred to five irrevocable |

|trusts, each for the benefit one of their children and that child's issue after the accountant, who prepared the Forms 709, |

|failed to report the transfers to the trusts and to allocate their GST exemptions to the transfers. Westlaw: PLR 201110004, 2011 |

|WL 838746 (March 11, 2011); Web: PLR 201110004, IRS Written Determinations (March 11, 2011). |

|IRS. Section 9100 - Extension of Time for Making Certain Elections. The IRS granted decedent's estate a 120-day extension to |

|allocate decedent's GST exemption to transfers to fifteen irrevocable trusts, each created by the decedent during life for the |

|benefit of one of decedent’s or one of decedent’s brothers’ children or that child’s issue after decedent's accountant failed to |

|prepare and file Forms 709. Westlaw: PLR 201110005, 2011 WL 838747 (March 11, 2011); Web: PLR 201110005, IRS Written |

|Determinations (March 11, 2011). |

|IRS. Section 2601 - Tax on Generation Skipping Transfers. The IRS ruled that the proposed division and modifications of an |

|irrevocable trust created by decedent for his two children and grandchildren or of successor trusts, one for the benefit of each |

|child’s family line, will not cause the trusts to lose their exempt status or cause any distribution from or termination of any |

|interests in the trusts to be subject to GST tax under I.R.C. § 2601. The actions will also not result in a transfer by any trust|

|beneficiary that will be subject to federal gift tax under IRC § 2501. Furthermore, no property of any of the trusts will |

|includible in the gross estate of any trust beneficiary under IRC § 2036, IRC § 2037, or IRC § 2038. Westlaw: PLR 201109004, 2011|

|WL 759587 (March 4, 2011); Web: PLR 201109004, IRS Written Determinations (March 4, 2011). |

|IRS. Section 9100 - Extension of Time for Making Certain Elections. The IRS granted taxpayers a 120-day extension to allocate |

|grantor's GST exemption and spouse's GST exemption to transfers to irrevocable trust which was then divided into two equal |

|shares, one for the benefit of each of their two daughters and her descendants after the attorney reviewing the couple’s estate |

|plan noticed that the CPA who prepared the gift tax returns failed to make the proper allocations on the Forms 709. Westlaw: PLR |

|201109005, 2011 WL 759588 (March 4, 2011); Web: PLR 201109005, IRS Written Determinations (March 4, 2011). |

|IRS. Section 9100 - Extension of Time for Making Certain Elections. In two PLRs, the IRS granted the executor of decedent's |

|estate and his spouse a 120-day extension to allocate their GST exemption to transfers to four trusts created by the couple for |

|the benefit of each of their four children and issue and to report the correct amount of their GST exemption allocated to a |

|second set of transfers under the automatic allocation rules of I.R.C. § 2632(c)(1) after they failed to file Form 709 to report |

|the first transfers, and the accountant who filed their Forms 709 for the second transfers mistakenly allocated less GST |

|exemption than should have been reported under the automatic allocation rules. Westlaw: PLR 201109009, 2011 WL 759592 and PLR |

|201109010, 2011 WL 759593 (March 4, 2011); Web: PLR 201109009 and PLR 201109010, IRS Written Determinations (March 4, 2011). |

| |

|LEGISLATION |

|Virginia. Formula Clauses Referring to Federal Estate and Generation-Skipping Transfer Tax Laws. Virginia has passed legislation |

|relating to formula clauses referring to federal estate and generation-skipping transfer tax laws in wills and trusts. The Act |

|amends a section added to the Code during the 2010 Session that was designed to address the consequences of the anticipated |

|repeal of the federal estate and generation-skipping transfer taxes with respect to estates and taxable transfers occurring in |

|2010, and the retroactive reinstatement of such taxes as well as other changes made to federal tax law. The act provides that the|

|decision by a decedent's personal representative not to have the estate tax apply to a decedent's estate in 2010 does not affect |

|the meaning of formula clauses for calculating transfers or devises based on federal estate or generation-skipping transfer tax |

|law contained in a will or other instrument. In addition, the legislation provides that the fiduciaries or beneficiaries of an |

|estate may petition the court to determine how the decedent would want such formula clauses construed, and may also enter into a |

|nonjudicial agreement regarding the construction of such clauses. The act is effective immediately. (2010 Virginia Senate Bill |

|No. 1423, Virginia 2011 Regular Session; Title: Wills & Trusts; Formula Clauses Referring To Federal Estate & Generation-Skipping|

|Transfer Tax Law., VERSION: Enrolled). Westlaw: 2010 VA S.B. 1423 (NS); Web: Virginia Legislature. |

| |

|Health Care |

| |

|ARTICLES |

|Chronic Illness; Practical Planning and Drafting, Part 2. Martin M. Shenkman, Joshua Rubenstein. (March/April, 2011, Probate and |

|Property). Westlaw: .25-APR Prob. & Prop. 48. |

|Complying with the Centers for Medicare & Medicaid Services Visitation Rule. Fay A. Rozovsky. (Journal of Health Care Compliance,|

|March/April, 2011). Westlaw: 13 No. 2 J. Health Care Compliance 15. |

|Rhetorical Federalism: the Role of State Resistance in Health Care Decision-Making. Elizabeth Weeks Leonard. (Journal of Law, |

|Medicine and Ethics, Spring, 2011). Westlaw: 39 J.L. Med. & Ethics 73. |

| |

|LEGISLATION |

|Virginia. Health Records; Disclosure Requirements. Virginia has passed legislation which clarifies that a health care entity is |

|required to share, at the request of the subject of the records, health records with other health care entities, in the format |

|requested by the individual in the manner authorized by the federal law unless (1) the electronic format is not reasonably |

|available without additional cost to the health care entity, (2) the records would be subject to modification in the format |

|required, or (3) the health care entity determines that the integrity of the records could be compromised in the electronic |

|format requested. (2010 Virginia House Bill No. 2515, Virginia 2011 Regular Session; Title: Health Records; Disclosure |

|Requirements., VERSION: Enrolled). Westlaw: 2010 VA H.B. 2515 (NS); Web: 2010 Virginia House Bill No. 2515. |

|Virginia. Electronic Health Records. Virginia has passed legislation which provides that health records, disclosure of which has |

|been authorized by a patient or as otherwise allowed by state law, are to be made available electronically but only to the extent|

|and in the manner authorized by federal law. The act also provides that a health care entity shall not be obligated to provide |

|records in the electronic format requested if (i) the electronic format is not reasonably available without additional cost to |

|the health care entity, (ii) the records would be subject to modification in the format requested, or (iii) the health care |

|entity determines that the integrity of the records could be compromised in the electronic format requested. (2010 Virginia House|

|Bill No. 2292, Virginia 2011 Regular Session; Title: Health Records; Electronic Access., VERSION: Adopted). Westlaw: 2010 VA H.B.|

|2292 (NS); Web: Virginia Legislature. |

| |

|Interest |

| |

|IRS DECISIONS, REGULATIONS, AND GUIDANCE |

|IRS. Federal Rates; Adjusted Federal Rates; Adjusted Federal Long-Term Rate and the Long-Term Exempt Rate–April 2011. Rev. Rul. |

|2011-10 provides various prescribed rates for federal tax purposes for April 2011. Westlaw: Rev. Rul. 2011-10, 2011 WL 924078 |

|(March 18, 2011); Web: Rev. Rul. 2011-10 (March 18, 2011). |

| |

|Irrevocable Trusts--See Trusts (Generally) |

| |

|Probate--See Estate/Trust Administration and Probate |

| |

| |

|Retirement |

| |

|IRS DECISIONS, REGULATIONS, AND GUIDANCE |

|IRS. Section 408 - Individual Retirement Accounts. The IRS waived the 60-day rollover requirement with respect to a distribution |

|from taxpayer’s IRA after an employee of the taxpayer’s bank advised taxpayer that the retirement funds could be removed for |

|90-days without penalty. Westlaw: PLR 201110014, 2011 WL 838755 (March 11, 2011); Web: PLR 201110014, IRS Written Determinations |

|(March 11, 2011). |

|IRS. Section 408 - Individual Retirement Accounts. The IRS granted taxpayer a 60-day extension to contribute a distribution from |

|her deceased husband’s IRA to a Rollover IRA due to an error by her financial advisor causing the funds to be deposited into a |

|non-IRA account. Westlaw: PLR 201110018, 2011 WL 838759 (March 11, 2011); Web: PLR 201110018, IRS Written Determinations (March |

|11, 2011). |

| |

|OTHER |

|U.S. Tax Court. Court Denies Taxpayer Deduction for IRA Contribution. On March 14, the U.S. Tax Court concluded that Robert |

|Kobell was not entitled to a deduction taken on his 2005 income tax return for a contribution to his IRA. Per IRC Sec. 219(b)(1),|

|(5) the deduction cannot exceed the “lesser of the deductible amount or an amount equal to the taxpayer's compensation includable|

|in gross income.” Kobell's 2005 income was comprised of Social Security benefits, which are not considered compensation, and |

|dividends and interest, which also are not compensation unless taxpayer is a dealer in stocks or securities and the amounts are |

|received in the course of his or her trade or business. Westlaw: Kobell v. C.I.R., T.C. Memo. 2011-66, 2011 WL 920298, U.S.Tax |

|Ct., 2011 (March 17, 2011); Web: Kobell v. C.I.R., T.C. Memo. 2011-66, U.S.Tax Ct., 2011 (March 17, 2011). |

| |

|Same Sex Marriages; Civil Unions; Domestic Partnerships |

| |

|ARTICLES |

|Advising Same-Sex Couples. Raymond Prather. (GPSolo, March, 2011). Westlaw: 28 No. 2 GPSolo 14. |

|Common Law Same-Sex Marriage. Peter Nicolas. (Connecticut Law Review, February, 2011). Westlaw: 43 Conn. L. Rev. 931. |

|The Defense of Marriage Act (DOMA) and California's Struggle with Same-Sex Marriage. John Rogers. (Regent University Law Review, |

|2010-2011). Westlaw: 23 Regent U. L. Rev. 97. |

|The Effects of Legally Recognizing Same-Sex Unions on Health and Well-Being. Holning Lau, Charles Q. Strohm. (Law and Inequality:|

|A Journal of Theory and Practice, Winter 2011). Westlaw: 29 Law & Ineq. 107. |

|A Quest for Fair and Balanced: the Supreme Court, State Courts, and the Future of Same-Sex Marriage Review After Perry. Chase D. |

|Anderson. (Duke Law Journal, March, 2011). Westlaw: 60 Duke L.J. 1413; Web: Duke Law Journal. |

|Same-Sex Couples and Consumer Credit Rights. Catherine M. Brennan. (Banking & Financial Services Policy Report, March, 2011). |

|Westlaw: 30 No. 3 Banking & Fin. Services Pol'y Rep. 23. |

|Searching for Harm: Same-Sex Marriage and the Well-Being of Children. Courtney G. Joslin. (Harvard Civil Rights-Civil Liberties |

|Law Review, Winter 2011). Westlaw: 46 Harv. C.R.-C.L. L. Rev. 81; Web: Harvard Civil Rights-Civil Liberties Law Review. |

| |

|Small and Mid-Size Law Firm Practice |

| |

|ARTICLES |

|Attorney Fees: How to Avoid a Conflict with Your Client. Mark A. Neubauer. (GPSolo, March, 2011). Westlaw: 28 No. 2 GPSolo 16. |

|Despite Decline of Traditional Media, Opportunities Abound. Nicholas Gaffney. (Marketing the Law Firm, March, 2011). Westlaw: 26 |

|No. 11 Marketing L. Firm 1. |

|Esignatures Support Lower Overhead Costs and Better Client Service. Andrew Flusche. (LJN's Legal Tech Newsletter, March, 2011). |

|Westlaw: 27 No. 11 LJN's Legal Tech Newsl. 7. |

|The Life and Health Insurance Guaranty System. Peter G. Gallanis. (GPSolo, March, 2011). Westlaw: 28 No. 2 GPSolo 34. |

|Marketing from a Young Partners Perspective. Kendyl Hanks and Craig Unterberg. (Marketing the Law Firm, March, 2011). Westlaw: 26|

|No. 11 Marketing L. Firm 5. |

|A Mouse That Rocks: the Smartfish Laser Mouse Keeps Your Hand on the Move. (Lawyer's PC, April 1, 2011). Westlaw: 28 No. 13 Law. |

|PC 1. |

|Online False Advertising Risks. Scott J. Slavick. (GPSolo, March, 2011). Westlaw: 28 No. 2 GPSolo 10. |

|Social Networking Initiatives. How LinkedIn Can Net Women Lawyers More Work. Debra Forman. (Law Firm Partnership and Benefits |

|Report, March, 2011). Westlaw: 17 No. 1 Law Firm Partnership & Benefits Rep. 3. |

|‘Tell Me More’. Answering and Profiting from the Most Important Question in Business. Steve Hughes . (Marketing the Law Firm, |

|March, 2011). Westlaw: 26 No. 11 Marketing L. Firm 1. |

|If We Could Do It Over Again ... Ten Technology Commandments for Opening a New Office. Audrey Rubin. (LJN's Legal Tech |

|Newsletter, March, 2011). Westlaw: 27 No. 11 LJN's Legal Tech Newsl. 1. |

| |

|OTHER |

|U.S. Senate. Vote to Repeal Expansion of Form 1099 Reporting Postponed until after March Recess. On March 17, Senate Majority |

|Leader Reid announced that the Senate would postpone a vote on S.AMDT.161 repealing the expansion of Form 1099 reporting |

|requirements until after the March recess. The expanded requirements cover payments made to corporations, payments for property |

|and other gross proceeds, and rental property expense payments, and for other purposes. Westlaw: 053 DER G-2, 2011, 2011 WL |

|914669 (March 18, 2011). |

|U.S. Senate. Amendment to Small Business Till Would Repeal Expanded 1099 Reporting. On March 15, Sen. Mike Johanns (R-Neb.) |

|offered an amendment (S. Amdt. 161) to a small business innovation bill (S. 493) that would repeal the expanded information |

|reporting that requires businesses and landlords to issue a Form 1099 for payments to corporations for goods and services that |

|exceed $600 per year to each vendor. Johanns proposes to pay for repeal using an adjustment to the premium assistance tax credits|

|from the 2010 health care law (Pub. L. No. 111-148) that was previously passed by the House. Westlaw: S.AMDT.161, 2011 WL 898453 |

|(March 17, 2011); Web: S.AMDT.161, 112th Congress (March 15, 2011) |

| |

|Special Needs Trusts; Guardianships |

| |

|ARTICLES |

|Special Needs Trusts: Employing a Parent as Caregiver. Thomas D. Begley, Jr., and Andrew H. Hook. (Estate Planning, April, 2011).|

|Westlaw: 38 ESTPLN 35. |

| |

|LEGISLATION |

|Montana. Uniform Power Of Attorney Act Adopted. Montana has passed legislation revising laws relating to powers of attorney, |

|including adopting the Uniform Power Of Attorney Act to replace the Statutory Form Power Of Attorney Act. The law also provides |

|causes of actions and penalties for the intentional dissipation of an estate through the use of a power of attorney. (2011 |

|Montana House Bill No. 374, Montana Sixty-Second Legislature - 2011 Session; Title: Implement The Uniform Power Of Attorney Model|

|Law, VERSION: Enrolled). Westlaw: 2011 MT H.B. 374 (NS); Web: Montana Legislature. |

|Utah. Updating Terms Relating To Persons With A Disability. Utah has passed legislation that, to the extent possible, replaces |

|outdated terms relating to persons with a disability with updated terms. The act, except where impracticable due to language used|

|in federal law, uniform law, interstate compacts, or case law, replaces the term “mental retardation,” and its variations, with |

|“intellectual disability”; “disabled person” with “person with a disability”; “mentally ill person” with “person with a mental |

|illness”; “paraplegic” with “person with paraplegia"; “guilty and mentally ill” with “guilty with a mental illness”; “guilty of a|

|lesser offense and mentally ill” with “guilty of a lesser offense with a mental illness”; and “crippled” with “disability”. (2011|

|Utah House Bill No. 230, Utah Fifty-Ninth Legislature - 2011 General Session, UTAH BILL TEXT). Westlaw: 2011 UT H.B. 230 (NS); |

|Web: Utah Legislature. |

|Virginia. Real Estate Tax Relief For The Elderly And Permanently And Totally Disabled. Virginia has passed legislation providing |

|for real estate tax relief for the elderly and permanently and totally disabled. The act authorizes local governments to |

|establish annual income or financial worth limitations as a condition of eligibility for real property tax relief for the elderly|

|and permanently and totally disabled. The law implements the amendment to Article X, Section 6 (b) of the Constitution of |

|Virginia that limits the General Assembly's ability to establish the limitations and allows the General Assembly to authorize |

|local governments to establish the limitations. (2010 Virginia House Bill No. 2278, Virginia 2011 Regular Session; Title: Real |

|Estate Tax; Relief For Elderly And Permanently And Totally Disabled., VERSION: Adopted). Westlaw: 2010 VA H.B. 2278 (NS); Web: |

|Virginia Legislature. |

|West Virginia. Financial Exploitation of the Elderly, Protected Persons and Incapacitated Adults. West Virginia has passed |

|legislation relating to crimes against the elderly, protected persons or incapacitated persons. The law addresses financial |

|exploitation of the elderly, protected persons and incapacitated adults in misappropriating or misusing assets; permits the |

|prosecutor to cumulate amounts or values when charging; permits banking institutions and others to report suspected financial |

|exploitation to law-enforcement authorities and other entities; permits financial institutions to disclose suspicious activity |

|reports or currency transaction reports to the prosecuting attorney; provides civil immunity for reporting; orders restitution; |

|and establishes the criminal penalty of larceny. (2011 West Virginia House Bill No. 2362, West Virginia Eightieth Legislature - |

|Regular Session, 2011; Title: Increasing Penalties For Financial Exploitation Of An Elderly Person Or Incapacitated Adult, |

|VERSION: Enrolled). Westlaw: 2011 WV H.B. 2362 (NS); Web: West Virginia Legislature. |

| |

|Trusts (Generally) |

| |

|ARTICLES |

|Designating the Application of Another State's Laws in a Trust. The Private Clients, Trusts and Estates Group of Schiff Hardin |

|LLP. (Estate Planning, April, 2011). Westlaw: 38 ESTPLN 40. |

|A Beneficiary Serving as Trustee May Affect Asset Protection. Kenneth W. Kingma. (Estate Planning, April, 2011). Westlaw: 38 |

|ESTPLN 22. |

|Disinheritance of Minor Children: a Proposal to Amend the Uniform Probate Code. Jacqueline Asadorian. (Boston College Third World|

|Law Journal, Winter, 2011). Westlaw: 31 B.C. Third World L.J. 101. |

|Specialization in Estate Planning, Trust and Probate Law. Donald G. Schweller. (Ohio Probate Law Journal, January/February 2011).|

|Westlaw: 21 No. 3 Ohio Prob. L.J. 6. |

| |

|LEGISLATION |

|Kentucky. Non-Kentucky Bank or Trust Company as Fiduciary. Kentucky has passed legislation that allows a non-Kentucky bank or |

|trust company to act as a fiduciary. In particular, the act amends KRS 395.005 to allow a bank or trust company organized under |

|the laws of a state other than Kentucky to be appointed as fiduciary for matters of descent, will, and administration to the |

|extent permitted pursuant to KRS 286.3-920(6) and this Act; amends KRS 286.3-010 to establish definitions for “out-of-state trust|

|company” and “trust representative office”; creates a new section of Subtitle 3 of KRS Chapter 286 to authorize Kentucky state |

|trust companies to have trust offices and trust representative offices in Kentucky as well as in other states to the extent the |

|reciprocal state's laws permit a Kentucky trust company to establish an office in the foreign state; establishes requirements for|

|a Kentucky state trust company to establish a trust office or trust representative in Kentucky or in another state; creates a new|

|section of Subtitle 3 of KRS Chapter 286 to authorize out-of-state trust companies to have trust offices and trust representative|

|offices in Kentucky to the extent the out-of-state trust company's home state allows Kentucky trust companies to establish trust |

|offices or trust representative offices in the foreign state; establishes requirements for an out-of-state trust company to |

|establish a trust office or trust representative in Kentucky; amend KRS 286.3-450 to allow the commissioner of the Department of |

|Financial Institutions to enter into cooperative, coordinating, and information-sharing agreements and agreements for joint |

|examinations and joint enforcement actions with other supervisory agencies having concurrent authority over trust offices and |

|trust representative offices; and amends KRS 286.3-290 to clarify that a branch office of an out-of-state bank may conduct |

|fiduciary activities authorized under Kentucky law for banks, provided that a branch office of a Kentucky bank is permitted to |

|engage in substantially similar activities in the out-of-state bank's host state. (2011 Kentucky House Bill No. 342, Kentucky |

|2011 Regular Session; Title: An Act Relating To Financial Matters., VERSION: Adopted). Westlaw: 2011 KY H.B. 342 (NS); Web: |

|Kentucky Legislature. |

|Michigan. Rule Against Perpetuities For Trust Property; Amendment. Michigan has passed legislation amending statutes that certain|

|personal property held in trust is excluded from the rule against perpetuities and similar rules that potentially affect the |

|duration of a trust (MCL 554.94). The act further defines the property exempt from the rule. (2011 Michigan Senate Bill No. 23, |

|Michigan Ninety-Sixth Legislature - Regular Session of 2011; Title: Probate; Trusts; Personal Property Trust Perpetuities Act; |

|Limit Application To Certain Property., VERSION: Adopted). Westlaw: 2011 MI S.B. 23 (NS); Web: Michigan Legislature. |

|Virginia. Inter Vivos QTIP Trusts. Virginia has passed legislation that provides when a donor spouse establishes a QTIP |

|(qualified terminable interest property) trust for his or her spouse which effectively gives the donee spouse a life estate in |

|the trust property or an inter vivos power of appointment marital deduction trust shall not have the trust property included in |

|the donor spouse's estate for estate tax purposes. (2010 Virginia Senate Bill No. 1072, Virginia 2011 Regular Session; Title: |

|Inter Vivos QTIP Trusts; If Established By Donor Spouse Not To Be Included In Estate., VERSION: Enrolled). Westlaw: 2010 VA S.B. |

|1072 (NS); Web: Virginia Legislature. |

|Virginia. Out-of-state Trust Institutions as Fiduciaries. Virginia has passed legislation that allows certain out-of-state trust |

|institutions to act in fiduciary capacities, including trustee, executor, and administrator. The law authorizes any national |

|banking association that is supervised and regulated by the federal Comptroller of the Currency and is authorized by the |

|Comptroller of the Currency to act as trustee, as executor, as administrator, or in another fiduciary capacity in the |

|Commonwealth, to engage in the trust business in the Commonwealth. This codifies an opinion of the state Attorney General that a |

|statutory provision barring out-of-state trust institutions without an office in the Commonwealth from engaging in trust business|

|as preempted by § 92a of the National Bank Act to the extent it applies to national banks that are supervised and regulated by |

|the Comptroller of the Currency. (2010 Virginia House Bill No. 2366, Virginia 2011 Regular Session; Title: Out-Of-State Trust |

|Institutions; Any National Bank To Serve As Trustee Without Office In State., VERSION: Adopted). Westlaw: 2010 VA H.B. 2366 (NS);|

|Web: Virginia Legislature. |

|Virginia. Form of Deeds When a Trust is the Grantor or Grantee. Virginia has passed legislation regarding the form of deeds when |

|a trust is the grantor or grantee of a deed. When a trust is the grantor or grantee of a deed, the law provides that the deed is |

|to contain the names of the trust's trustees serving at the time the deed was made. (2010 Virginia House Bill No. 2507, Virginia |

|2011 Regular Session; Title: Deeds And Deeds Of Trust; When Trust Is Grantor Or Grantee, It Shall Contain Certain Names., |

|VERSION: Adopted). Westlaw: 2010 VA H.B. 2507 (NS); Web: Virginia Legislature. |

|Virginia. Land Trusts; Successor Trustees. Virginia has passed legislation regarding land trusts and successor trustees. The Act |

|provides that where a land trust has been created by the recordation of a deed of conveyance to a trustee, and the trustee named |

|in the deed is unable to serve, the beneficiaries of the trust, by majority decision, are to name a successor trustee. If the |

|beneficiaries cannot be identified, or cannot agree on a successor trustee, the circuit court where the deed was recorded will |

|name the successor trustee. The name and address of the successor trustee shall be recorded with the clerk. (2010 Virginia House |

|Bill No. 2133, Virginia 2011 Regular Session; Title: Land Trusts; Trustee Named In Deed Is Unable To Serve, Beneficiaries Shall |

|Name A Successor Trustee., VERSION: Adopted). Westlaw: 2010 VA H.B. 2133 (NS); Web: Virginia Legislature. |

|Virginia. Subdivision Of A Lot Held In Trust For Conveyance To A Family Member. Virginia has passed legislation regarding the |

|subdivision of a lot held in trust for conveyance to a family member. The act authorizes localities to provide for subdivision of|

|a lot for conveyance to a family member if the land is held in trust. All trust beneficiaries must be immediate family members |

|and must agree that the property should be subdivided. Additionally, all beneficiaries must agree to place a restrictive covenant|

|on the subdivided property that would prohibit the transfer of the property to a nonmember of the immediate family for a period |

|of 15 years. A locality may provide exceptions to this 15-year time period but must execute a writing reflecting such |

|modification. (2010 Virginia Senate Bill No. 873, Virginia 2011 Regular Session; Title: Subdivision Of Lot; Localities To Provide|

|For Conveyance To Family Member If Land Is Held In Trust., VERSION: Adopted). Westlaw: 2010 VA S.B. 873 (NS); Web: Virginia |

|Legislature. |

|Virginia. Formula Clauses Referring to Federal Estate and Generation-Skipping Transfer Tax Laws. Virginia has passed legislation |

|relating to formula clauses referring to federal estate and generation-skipping transfer tax laws in wills and trusts. The Act |

|amends a section added to the Code during the 2010 Session that was designed to address the consequences of the anticipated |

|repeal of the federal estate and generation-skipping transfer taxes with respect to estates and taxable transfers occurring in |

|2010, and the retroactive reinstatement of such taxes as well as other changes made to federal tax law. The act provides that the|

|decision by a decedent's personal representative not to have the estate tax apply to a decedent's estate in 2010 does not affect |

|the meaning of formula clauses for calculating transfers or devises based on federal estate or generation-skipping transfer tax |

|law contained in a will or other instrument. In addition, the legislation provides that the fiduciaries or beneficiaries of an |

|estate may petition the court to determine how the decedent would want such formula clauses construed, and may also enter into a |

|nonjudicial agreement regarding the construction of such clauses. The act is effective immediately. (2010 Virginia Senate Bill |

|No. 1423, Virginia 2011 Regular Session; Title: Wills & Trusts; Formula Clauses Referring To Federal Estate & Generation-Skipping|

|Transfer Tax Law., VERSION: Enrolled). Westlaw: 2010 VA S.B. 1423 (NS); Web: Virginia Legislature. |

|West Virginia. Amendments to Trusts and Estates Provisions; Adopting West Virginia Uniform Trust Code. West Virginia has passed |

|legislation relating generally to estates and trusts and their administration, and providing that certain provisions of current |

|law to have no effect after specified date. The act changes names of certain articles of existing code; provides for the |

|creation, administration, revision and termination of trusts; provides for trustees, powers and duties of trustees and |

|substitution of trustees; provides for distribution of trust assets; specifies powers and certain restrictions on powers of |

|fiduciaries; amends the Uniform Prudent Investor Act; and modernizes language of certain existing sections of code and deleting |

|obsolete language. The law adopts the West Virginia Uniform Trust Code; providing general provisions and definitions; judicial |

|proceedings; representation of trusts; creation, validity, modification and termination of trusts; creditor's claims; spendthrift|

|trusts, discretionary trusts and revocable trusts; the office of trustee; duties and powers of trustees; liability of trustees |

|and rights of persons dealing with trustee; and various miscellaneous provisions for trusts and trustees. In addition, there is a|

|delayed effective date for West Virginia Uniform Trust Code and providing rules for application of that date. (2011 West Virginia|

|House Bill No. 2551, West Virginia Eightieth Legislature - Regular Session, 2011; Title: Relating Generally To Estates And Trusts|

|And Their Administration, VERSION: Enrolled). . Westlaw: 2011 WV H.B. 2551 (NS); Web: West Virginia Legislature. |

|Wyoming. Uniform Trust Code Amendments. Wyoming has passed legislation relating to the Uniform Trust Code. The law provides for |

|the attachment of property in a trust by creditors or assignees of a holder of a power of appointment as specified; amends when a|

|creditor or assignee of a trust beneficiary may reach or attach the interest of the beneficiary in a trust; provides that a |

|married person who created a trust for his spouse is not to be treated as a settlor of the trust upon the death of his or her |

|spouse; provides that a trust instrument may not be deemed revocable because of the settlor's receipt each year of income or |

|principal from a grantor retained annuity trust or grantor retained unitrust as specified. (2011 Wyoming House Bill No. 159, |

|Wyoming Sixty First Legislature - 2011 General Session; Title: Uniform Trust Code Amendments., VERSION: Adopted). Westlaw: 2011 |

|WY H.B. 159 (NS); Web: Wyoming Legislature. |

| |

|OTHER |

|U.S. District Court. Court Grants Preliminary Injunction Blocking California Pair from Promoting “Common-Law” Trusts. On March |

|11, 2011, the U.S. District Court Central District of California granted the government’s request for a preliminary injunction |

|preventing Gwenn Wycoff and Frank Ozak of California from promoting, creating or operating on, creation, and operation of |

|“abusive trusts”. According to the injunction the court found that the pair “jointly advise individuals and business operators |

|about the benefits of establishing ‘common-law’ trusts, which they claim will allow their customers to avoid the payment of |

|federal income taxes.” The activities were originally promoted via the Kenzington Fund's website, “” but in |

|2004, they began utilizing another website, “.” Westlaw: Preliminary Injunction in United States v. Wycoff, |

|2011 WL 914607 (March 18, 2011); Web: United States v. Wycoff, C.D. Cal., No. 2:10-cv-05856-JHN-PLAx (preliminary injunction |

|issued March 11, 2011). |

| |

|Wills |

| |

|LEGISLATION |

|Idaho. Intestate Succession And Wills. Idaho has passed legislation concerning intestate succession. The act amends existing law |

|relating to intestate succession and wills to revise the time frame for filing a disclaimer under certain circumstances; and to |

|remove outdated provisions. (2011 Idaho Senate Bill No. 1121, Idaho Sixty-First Idaho Legislature, First Regular Session - 2011; |

|Title: Intestate Succession, Wills, VERSION: Adopted). Westlaw: 2011 ID S.B. 1121 (NS); Web: Idaho Legislature. |

|Virginia. Formula Clauses Referring to Federal Estate and Generation-Skipping Transfer Tax Laws. Virginia has passed legislation |

|relating to formula clauses referring to federal estate and generation-skipping transfer tax laws in wills and trusts. The Act |

|amends a section added to the Code during the 2010 Session that was designed to address the consequences of the anticipated |

|repeal of the federal estate and generation-skipping transfer taxes with respect to estates and taxable transfers occurring in |

|2010, and the retroactive reinstatement of such taxes as well as other changes made to federal tax law. The act provides that the|

|decision by a decedent's personal representative not to have the estate tax apply to a decedent's estate in 2010 does not affect |

|the meaning of formula clauses for calculating transfers or devises based on federal estate or generation-skipping transfer tax |

|law contained in a will or other instrument. In addition, the legislation provides that the fiduciaries or beneficiaries of an |

|estate may petition the court to determine how the decedent would want such formula clauses construed, and may also enter into a |

|nonjudicial agreement regarding the construction of such clauses. The act is effective immediately. (2010 Virginia Senate Bill |

|No. 1423, Virginia 2011 Regular Session; Title: Wills & Trusts; Formula Clauses Referring To Federal Estate & Generation-Skipping|

|Transfer Tax Law., VERSION: Enrolled). Westlaw: 2010 VA S.B. 1423 (NS); Web: Virginia Legislature. |

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|Version 2011-1 of Trust Plus and TrusTerminator has been released and is ready for download from the Software Updates area of |

|Members Only at . With this release you will find several new, exciting content and feature additions and |

|enhancements. We hope you will find the enhancements in 2011-1 to be welcome additions to your estate planning practice! |

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|An overview of the enhancements in Version 2011-1: |

|Updated options and language for the 2010 Tax Relief Act. There are changes in both Trust Plus and TrusTerminator. An online |

|learning program on the new tax options in Trust Plus is available on Members Only. |

|A new IRA trust module has been added in Trust Plus. |

|QTIP/Marital Trust – Expanded options for a surviving spouse to serve as a trustee have been added. |

|There is an updated Non-Statutory Power of Attorney Bond Selection Screen |

|A new Find a Name feature in both Trust Plus and TrusTerminator allow you to find a name and address you have used in any of your|

|sessions and create a letter or email. |

|Updates to substantive legal help and state statutory forms (including California's Preliminary Change of Ownership form and a |

|trustee's duty to inform and report) have been made. |

|TrusTerminator has a new Register report (for transfers and transactions between a trust's asset accounts). |

|Many customization features for the Register and Trust Accounting reports in TrusTerminator have been added. |

|TrusTerminator reports can now be directly accessed via a new button on the Main menu bar. |

|There are updated drafting checklists incorporating new tax planning options in the revocable trust and will checklists and a new|

|IRA Trust checklist. |

|There are updated substantive articles in Members Only reflecting the 2010 Tax Relief Act and other changes. |

|Help files for Trust Plus and TrusTerminator have been updated. |

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|In addition, support is always just a phone call away using the following numbers: |

|License activations - Customer Technical Support, 1-800-366-1730 (option 1) |

|Questions about your West account or requests to add/remove Members Only or Listserve access - Customer Service, 1-800-366-1730 |

|(option 2) |

|Content questions and questions on how to use the software - Reference Attorneys, 1-800-277-9378 (option 3) |

|Technical software problems and questions (installation, networking, technical errors) - Customer Technical Support, |

|1-800-366-1730 (option 4) |

|Sales of supplies (Estate Organizer Binders, client booklets, etc.) - Inside Sales, 1-800-366-1730 (option 5) |

|To schedule training on using the software - Telephone Training, 1-800-328-0109 (option 1) |

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