NYC elder law estate planning

Float like a Butterfly, Sting like a Contested Estate: Muhammad Ali’s Unhappy Heirs

Published on: July 2, 2016 | by Ettinger Law Firm

It seems that Muhammad Ali’s estate is destined for trouble, similar to other celebrity estates that we have covered on this blog recently. It is unknown if the boxing legend died with a will, but even if he did, a will contest may be likely. Forbes reports that Mr. Ali died with an estate worth in between $50 and $80 million, had nine recognized children, four different marriages, and struggled with a debilitating disease that affects the mind. These are the circumstances that set the stage for a drawn out estate contest.

Troublesome Children

The large amount of children Mr. Ali had, as well as his four marriages, makes the number of people who may have an interest in contesting Mr. Ali’s estate quite high. One child in particular, Muhammad Ali Jr., has been estranged from his father since Mr. Ali’s fourth and final marriage in 1986 and has been cut off from the family fortune ever since. Ali Jr. in particular blames Mr. Ali’s fourth wife for driving him and his father apart.

VETERANS ADMINISTRATION PENSIONS – AID AND ATTENDANCE PENSION

Published on: January 29, 2016 | by Ettinger Law Firm

The Veterans Administration has a program that allows for a large subset of the veterans population to qualify for certain benefits that pay for costs associated with caring for a veteran or their spouse. This Aid and Attendance pension may be in addition to any pension that the service member and/or their spouse may already receive. The Housebound pension also covers certain costs associated the care and attendance to the veteran or their spouse when they are primarily confined to their residence. While a veteran or their spouse may already receive a pension, as well as these additional benefits, one cannot receive both the Aid and Attendance benefits as well as the Housebound benefits. It is important to note at the outset the difference between a pension and compensation.

Compensation is a sum of money that the veteran receives, tax free, for disabilities that the veteran suffered in relation to their time as a service member. The compensation is meant to make up for any loss of income due to the disability. A Pension is meant to provide additional monies to low income or disabled veterans who served during a period of war, or in a war zone. Both of these benefits are distinct from a military retirement. The benefits under these Veterans Administration programs have been in existence for over 60 years, yet many Veterans Administration officials and Veterans Administration attorneys were unaware of these benefits until recently.

WHAT IS COVERED

HOW LONG CAN IRS COME AFTER ME? THE SUMNER REDSTONE CASE

Published on: January 2, 2016 | by Ettinger Law Firm

Sumner Redstone is an entertainment business mogul with a majority share ownership of CBS entertainment and Viacom, and through Viacom, BET and Paramount Pictures, all through his majority ownership of his family business, National Amusement, which originally started out in the drive in movie theater business during The Great Depression. In just the last few weeks a case against Mr. Redstone by the IRS presents an oddity in the law, which may make many people shutter. More particularly, the IRS issued a Notice of Deficiency for a taxable event from 1972 – over 40 years later.

The nature of the case revolved around a transfer of shares in National Amusement Corporation in 1972 to separate trusts set up for the grandchildren of the founder, Sumner Redstone’s father Michael Redstone. Sumner set up one trust for his kids while his siblings set up separate trusts for their kids. At the time the transfer of interfamily stock was of a insignificant amount that passing them from personal ownership to a trust did not even require a tax return. One can and should ask about the concept of a statute of limitation.

Apparently, as the case against Mr. Redstone shows, the IRS does not have a statute of limitation for unfiled tax returns. 26 U.S.C. § 6501(c)(1) establishes that when a taxpayer files a fraudulent tax return, (c)(2) otherwise attempts to avoid tax liability, or (c)(3) fails to file a tax return, there is no statute of limitation. Mr. Redstone has an impressive educational pedigree, where he graduated from first in his class from the Boston Latin School and then graduated Harvard in only three years in 1944, which was actually common at the time. After graduation he served as an officer in the United States Army, helping to decode Japanese messages. He attended Georgetown Law School after the war and then received his LL.B. in 1947 from Harvard Law. After working for various governmental departments followed by private practice, Mr. Redstone went to work for the family business, which was booming by then.

Tax Planning for Required Minimum Distributions

Published on: September 16, 2015 | by Ettinger Law Firm

Not all investments are created equal. You investment portfolio may include a 401(k), individual retirement account, pension plan, or deferred compensation plan, among others investment vehicles. Whether your investment trust account is qualified under the Internal Revenue Code will determine the tax treatment of your contributions and withdrawals.

Qualified vs. Non-Qualified Investment Accounts

A tax-qualified account features the ability to contribute income to the qualified account and defer tax on the account funds. Typically, you must be 59 ½ to withdrawal funds from a tax-qualified account without penalty. Conversely, non-qualified accounts do not offer tax deferred treatment. When you withdraw funds from a tax-qualified account, your entire withdrawal will be taxable, as opposed to being taxed on only the growth of your non-qualified account. Qualified tax plans include, but are not limited to: