Archive for the ‘Thursday Reports’ Category

Dualinars, In-State Tuition and Some Humor

Posted on: August 15th, 2013

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Wednesday was a blur; to Thursday I demur.

Demur is defined later in this report.

PROFESSIONAL QUOTE OF THE WEEK

“I am always glad to try to help another practitioner if I can”

-       William “Bill” P. Weatherford, Jr.

 Anyone who knows Bill Weatherford in Winter Park is aware that he is a gentleman and a scholar.  The above was sent to us after thanking him for going through an ex-client’s file and letting us know where to find important documents.  He did this without delay.  Thanks again Bill!

Pre-Nuptial and Post-Nuptial Agreements: An Interview with noted divorce attorney, Ky Koch and Judge George Jirotka – Part 2 of a 7 Part Series

In-State Means In-State:  A Quick Overview of the Residency Requirements for In-State Tuition at Florida’s Public Universities – It’s Not What You Think It Is by Alan S. Gassman and Eric Brooks

Phil Rarick’s Fantastic and Informative Client Blog Entries: Homestead: Three Tricky Issues to Watch

Profiled “Dualinars” of the Week: Financial Planning Association of Tampa Bay and the Third Annual Federal Tax Institute of New England

11 Steps to Happiness at Work

Our Best Testimonial Ever!

Thursday Report Jokes

Definition of the Week and a Quick Contest

We welcome contributions for future Thursday Report topics. If you are interested in making a contribution as a guest writer or to win $1,000,000 in KFC gift certificates, please email Janine Gunyan at Janine@gassmanpa.com.

 This report and other Thursday Reports can be found on our website at www.gassmanlawassociates.com.

Our Best Testimonial Letter Ever! 

We have never met Susan King, but she became our favorite person in the galaxy when she sent the e-mail quoted below on Thursday, August 1:

Hello Alan,

I have been receiving your Thursday Report for several months now and I find it very helpful so I wanted to thank you for all of the work and information that goes into each report. As a solo practitioner your office webinars and reports have become a great resource.

I also wanted to thank you for the great information on Florida Land Trusts in the August 1, 2013 edition. This type of trust is something that I feel could be helpful to certain clients of mine but until I read your article I was a bit unsure how to present it to them. I now feel better prepared and will bring this up for discussion.

 I would like to recommend to some of my colleagues that they ask to be put on your e-mail list. May I just forward them your e-mail address or is there a different one that should be used for this purpose? I added to the list after attending my first webinar and I do not recall if there is a separate link to sign up.

 Warmest regards,

Susan King picture with quote

Susan M. King
Attorney at Law
2499 Glades Road
Suite 111
Boca Raton, FL 33431
Tel:  561.989.0622
Fax: 561.989.9982
sking@smkinglaw.com
www.smkinglaw.com
 

We thank Susan so much for this wonderful compliment.

This is a wonderful reminder of how easy it is to make someone else’s day by telling them something nice about themselves, whether it is true or not!

Pre-Nuptial and Post-Nuptial Agreements: An Interview with noted divorce attorney, Ky Koch and Judge George Jirotka – Part 2 of a 7 Part Series

Koch and Jirotka with quotes

This week we cover the important topics of how much disclosure is enough disclosure, whether both parties need to have lawyers, and questions to ask the lawyer or spouse you are not representing to document appropriate disclosure and circumstances by video taped interview or written correspondence.

  • Last Thursday, August 8, 2013, the reader was introduced to the present overall status of prenuptial agreement statutory law and caselaw, and talks about prominent malpractice traps and how to get clients prepared for what they can encounter in the prenuptial agreement universe.  Click here to be directed to the Thursday Report for August 8, 2013.
  • Part 2, today, August 15, 2013, discusses the important topics of how much disclosure is enough disclosure and whether or not both parties need to have lawyers.
  • Part 3 on Thursday, August 22, 2013, Questions to ask the lawyer or spouse you are not representing to document appropriate disclosure circumstances by video-taped interview or written correspondence.
  • Part 4, on Thursday, August 29, 2013, the article discusses Castro v. Castro and Belcher v. Belcher, and what they mean for clients and lawyers who are involved in the pre and post nuptial agreement planning.
  • Part 5, on Thursday, September 5, 2013, a discussion of alimony and lawyer fee obligations that may not be waivable in pre-nuptial or post nuptial agreements, and offset clauses and other ways to handle these.
  • Part 6, on Thursday, September 12, 2013, Bifurcation – whether you can require the validity of the pre-nuptial or post-nuptial agreement be litigated or also before having to also litigate what the result could be if it is or is not enforceable.
  • Part 7, on Thursday, September 19, 2013, How to keep marital and asset information confidential in a divorce scenario, arbitration, and the Roddy v. Roddy case.

Below is the next part of the interview:

Alan Gassman: Now on the amount of disclosure, does it have to be a 30 page disclosure document that shows the spouse a copy of every type of document, including brokerage statements and prior tax returns, or can it be schedule of the 12 biggest assets, which add up to $9,000,000.  What kind of financial disclosure would you be providing for your clients if you were practicing Judge?

Judge Jirotka: Well, my understanding from the cases I have reviewed is that it cannot be just a simple statement: ranch in Idaho, stock.  It has to be a little bit more detailed – a little bit is my word, not necessarily the appellate court’s word.  What kind of stock, how many shares, how big a ranch, where is it?  There is some case law on this, and Ky correctly points out that we don’t have a whole lot of case law on the statute per se.  We do have some pre-statute case law that requires much more disclosure than simple statements.

Ky Koch: My advice to clients when I’ve got the monied spouse is to tell them to put it all on the disc and pack it with your tax returns.  If you’ve got business valuations put them in there.

Alan Gassman: Financial statements.

Ky Koch: Brokerage statements, all your financials you’ve given to the banks.  Give them more rather than less because you don’t want it to be challenged for insufficient disclosure.  By the way, I tell them if you’re going to estimate values, estimate on the way high side.  For instance, if you were in business and you estimate its value at $100,000 in your prenup, if you get divorced, and your wife relied upon that representation, it is not good if she comes back in and says well that business is really worth $10,000,000, not $10,000.

Alan Gassman: Wow.

Ky Koch: Those are the kind of things that you need to be cautious of in drafting these agreements and attaching financial disclosures.

Alan Gassman: In the basic elements there’s no mention that there has to be a lawyer representing either party.

Judge Jirotka: That is correct.

Alan Gassman: So people are going to bookstores, I guess, and buying these agreements.  Those are going to be interesting, but Ky what’s your attitude when you draft one of these agreements and the other party just signs it and sends it back?  Do you require them to have a lawyer?

Ky Koch: Well, those are difficult situations, but you’ve got the agreement packed with language saying the undersigned has been advised to seek counsel and have this agreement in their possession for X number of days, weeks or months.  They have either sought counsel or have chosen not to do it and they’re doing so at their peril.  Judge Jirotka’s going to talk in a minute about a case he was just alluding to and that’s about representation of lawyers.

Judge Jirotka: Ky, if I could just ask in your preparing of these type of agreements and the disclosure aspect that Alan was talking about, would you attach the monied spouse’s financials to the agreement as an exhibit or would you do a separate document, or refer to it or how would you do that?

Ky Koch: In every instance we have it attached to the agreement.

Judge Jirotka: So it would be a copy – for example of the then current brokerage statement?

Ky Koch: Exactly, and I would make it as complete as possible.  I’ll have a summary sheet, which would be a financial statement, and then backup.

Profiled “Dualinars” of the Week:

A dualinar is two seminars profiled at once in a weekly report – Webster’s World Dictionary

Financial Planning Association of Tampa Bay 2013 Florida Symposium

Zahan

 

This two day intensive financial planning seminar will take place next Monday and Tuesday, August 19 and Tuesday, August 20 and is called FPA of Tampa Bay 2013 Florida Symposium at the Marriott Westshore Tampa, 1001 N Westshore Blvd.

Alan Gassman will be joining Ken Zahn, CFP at the Financial Planning Association (FPA) Tampa Bay 2013 Florida Symposium.   Ken Zahn and Alan Gassman will speak Monday, August 19 from 3pm until 5pm on the mechanics of the federal estate tax and use of the new software program developed by Gassman Law Associates, which will be distributed at no charge to attendees.

Ken Zahn, is a very well known and respected CFP course author and lecturer.  He has a great sense of humor, amazing common sense, and most importantly he reads the Thursday Report.  Ken has also provided us with very good advice for the next improved version of our software.

Other notable speakers at the Symposium include Elizabeth Jetton, CFP, Linda Chamberlain, JD, CMC and Dale Van Scoyk, GFS.  On Tuesday afternoon there will be a 2 hour program that will fulfill the CFP ethics portion of the recertification process.  For more information and to register for this webinar please click here.

Please plan to attend this excellent event.

Third Annual Federal Tax Institute of New England

Federal Tax pictures

The Federal Tax Institute of New England is hosting its Third Annual Comprehensive All-Day Program for 2013 and Beyond on Friday, September 27, 2013 in Farmington, Connecticut.  Speakers for the event include Professor Jerry Hesch, Bruce Stone, Ronald Aucutt and Lawrence Brody to name just a few.  This will be a fantastic event that you will not want to miss.  Click here for more information.

 Weekend in New England (our lyrics by Barry Taxesmelow are based off of the lyrics and song by Barry Manilow)

Time in New England.

Took me away.

To a tax deductible seminar.

Hip hip hooray.

I got to see Bruce Stone and Jerry by the Bay.

Not to mention Larry Brody, a bell man with a goatee.

With nice cool weather I Wish I could stay.

When will our forms meet?

When can I PowerPoint?

Why will this strong seminar have to end?

Even Barry Manilow may attend this fantastic one-day seminar in Farmington.

Fly into Hartford on Thursday afternoon and enjoy a day by Batterson Pond Park.

Attend the seminar on Friday, and then drive along I84 to see the leaves change.

Listen to continuing education tapes on the way and discuss them with your extremely tolerant significant other.

Rooms are available at the Hartford Marriot Farmington Hotel.

If you have never seen Connecticut or if you have seen it and want to go back, here is your opportunity.

And who signed the Declaration of Independence for Connecticut?

It was none other than Samuel Huntington, Roger Sherman, William Williams, and Oliver Wolcott.

11 Steps to Happiness at Work, a Profile of Dr. Srikumar Rao’s book Happiness at Work 

Rao with quote

 

Dr. Srikumar Rao is the creator of the groundbreaking program Creativity and Personal Mastery in which he has helped thousands of professionals find happiness in their professional and personal lives.  He is also the author of two acclaimed books, Happiness at Work and Are You Ready to Succeed.

Dr. Rao will be visiting us in Clearwater the week of October 7, 2013.  He will be speaking at a Meet & Greet cocktail party and a half-day workshop.

The topic for the Wednesday, October 9, 2013 Meet & Greet is “Good Thing – Bad Thing – Who Knows? Changing Your Immediate and Long-Term Responses to Events and Challenges.”  This event will take place at the Holiday Inn Express on U.S. 19 and Gulf-to-Bay Blvd. in Clearwater and begins at 6pm with wine and hors d’oeuvres.  All Thursday Report readers are invited to attend the cocktail party and can register for the event by clicking here.

On Saturday, October 12, 2013, Gassman Law Associates, Dean & Associates CPAs, LLLP and Spine & Orthopedic Center, P.A. will sponsor a half-day workshop with Dr. Rao on Enhanced Effectiveness and Enjoyment of Your Professional and Personal Life.  The cost of the workshop is $575, however if you register before September 1, 2013 you will pay the discounted rate of $495.  Full time students and medical interns and fellows can attend for $285.  This workshop will also take place at the Holiday Inn Express on U.S. 19 and Gulf-to-Bay Blvd.  The program begins promptly at 1pm and will end around 6pm.  There will be an optional question and answer session with Dr. Rao after a brief dinner break.  If you would like to attend the half-day workshop please click here to register.

Dr. Rao’s program began in top business schools including Columbia Business School and the London School of Business.  Through the years he has honed his expertise into a series of tools and exercises designed to help you rid yourself of the stresses of daily life, learn to appreciate the things you have and look toward the future with a clear vision of the path ahead.  The half-day workshop will touch on a few of the tools that Dr. Rao teaches in his program.

Forbes writer, Jacquelyn Smith, has written a profile on Dr. Rao’s book Happiness at Work that is quite instructive.

To achieve greater happiness at work, you don’t need your boss to stop calling you at night. You don’t need to make more money. You don’t need to follow your dream of being a sommelier, or running a B&B in Vermont. So says Srikumar Rao, the author of Happiness at Work. The biggest obstacle to happiness is simply your belief that you’re the prisoner of circumstance, powerless before the things that happen to you, he says. “We create our own experience,” he adds. Here are 11 steps to happiness at work, drawn from his recommendations.

1. Avoid “good” and “bad” labels. When something bad happens, don’t beat yourself up, says Rao. Instead, when you make an error, be aware of it without passing judgment. “Do what you have to do, but don’t surrender your calmness and sense of peace.”  For example, if you make a mistake at work the best thing to do is to realize your mistake, figure out what you can learn from the mistake and then move past it.  Dwelling on the mistake only leads to further mistakes and can lead to a bad day all around.

2. Practice “extreme resilience.” Rao defines “extreme resilience” as the ability to recover fast from adversity. “You spend much time in needless, fruitless self-recrimination and blaming others,” he writes. “You go on pointless guilt trips and make excuses that you know are fatuous. If you’re resilient, you recover and go on to do great things.” (He also says that if you fully take his advice to avoid “bad thing” labels, you don’t have to practice resilience at all.)

3. Let go of grudges.  Rao says that a key to being happy at work is to let go of grudges. “Consciously drop the past,” he writes. “It’s hard, but with practice you will get the hang of it.”

4. Don’t waste time being jealous.  “When you’re jealous you’re saying that the universe is limited and there is not enough success in it for me,” says Rao. “Instead, be happy, because whatever happened to him will happen to you in your current job or at another company.”

5. Find passion in you, not in your job.  Sure, you can fantasize about a dream job that pays you better and allows you to do some kind of social good, work with brilliant and likable colleagues and still be home in time for dinner, but Rao warns against searching for that perfect position, or even believing that it exists. Instead, he advocates changing how you think about your current situation. For example, instead of thinking of yourself as a human resources manager at a bank, identify yourself as someone who helps other bank employees provide for their families, take advantage of their benefits and save for the future.

6. Don’t view people as mechanisms.  “Much of the time we evaluate other persons in terms of what they can do for us,” Rao says. “[For instance], we are super nice to senior executives because of the help they can give us.” Don’t relate to people in terms of the role they play; rather relate to them as one human being to another–”and serve them because that is what you are on Earth to do.”

7. Picture yourself 10 years ago and 10 years from now.  “Most problems that kept you awake ten years ago have disappeared,” says Rao. “Much of what troubles you today will also vanish. Realizing this truth will help you gain perspective.”

Even in corporate America, where so much of work is every man for him or herself, Rao advocates inhabiting an “other-centered universe.” If the nice guy gets passed over for a promotion, he still may succeed in less tangible ways or land an even better job down the road. “They may rise later in the shootout,” says Rao. “I’m challenging the assumption that you need to be a dog-eat-dog person to survive in a corporate environment.”

8. Banish the “if/then” model of happiness.  Rao says that many of us rely on a flawed “if/then” model for happiness. If we become CEO, then we’ll be happy. If we make a six-figure salary, then we’ll be happy. “There is nothing that you have to get, do or be in order to be happy,” he writes.  To see Dr. Rao’s TED video please click here.

9. Invest in the process, not the outcome.  “Outcomes are totally beyond your control,” Rao writes. You’ll set yourself up for disappointment if you focus too much on what you hope to achieve rather than how you plan to get there.

10. Think about other people.  Even in corporate America, where so much of work is every man for him or herself, Rao advocates inhabiting an “other-centered universe.”

11. Swap multitasking for mindfulness.  Rao thinks that multitasking gets in the way of happiness. “Multitasking simply means that you do many things badly and take much more time at it,” he writes. He recommends instead working on tasks for 20-minute intervals that you gradually increase to two-hour spans. Turn off any electronic gadgets that can be a distraction. He claims that with practice, you’ll be able to accomplish much more and with less effort.

Dr. Rao was also featured in a new article on Fast Company.  To view the article please click here.

For more information or to attend either program please email agassman@gassmanpa.com.

Thursday Report Humor

Our copyrighted joke:

What do you call a wallaby with gangrene? 

Click here for the answer to our copyrighted joke.

Permission to use this joke is given only to those who receive the Thursday Report and like it!

Colonel Sanders and the Pope

Colonel Sanders is on his death bed and has one final wish. So he calls up the Pope and says “Pope, I’ll donate a million dollars to the Church if you do a favor for me.” The Pope asks what it is.

The Colonel says “You know the Lord’s Prayer? The line that says ‘Give us this day our daily bread?’ I want you to change that to ‘Give us this day our daily chicken.’”

The pope thinks for a minute, because after all, a million dollars! But then says no.

The next day, Colonel Sanders calls back. “I’ll up my offer. I’ll donate one hundred million dollars if you change the line to ‘Give us this day our daily chicken’.”

The next day, an announcement goes out to all the cardinals and bishops all over the world. It reads “I have good news and bad news. The good news is that we just got a one hundred million dollar donation. The bad news is that we just lost the Wonder Bread account.”

Phil Rarick’s Fantastic and Informative Client Blog Entries: Florida Homestead: Three Tricky Issues to Watch

Rarick

 

Our friend Phil Rarick of Rarick, Beskin & Garcia Vega, P.A. in Miami has been kind enough to allow us to provide one of his excellent client communications articles each week until you have read all of them.

Phil Rarick has 30 years of experience in both private and public legal work. Mr. Rarick concentrates in the fields of estate planning (wills and trusts), asset protection, probate, and corporate law. Integrated asset protection with an estate plan designed to protect wealth and secure tax advantages are a primary focus of his practice. He is an active member of the Elder Law Section of the Florida Bar, and the Real Property, Probate and Trust Law section of the Florida Bar Association.

Mr. Rarick is the author of a number of popular guides for fellow attorneys and the public, including Florida Probate Quick Reference Guide and Understanding Living Trusts for Florida Residents.

Mr. Rarick is the President of the Miami Lakes Bar Association, and served as a Director of the Association since its founding in 2005.

This week’s entry is entitled Florida Homestead: Three Tricky Issues to Watch and can be found by clicking here.

Have you considered writing articles like this for your clients and for those in your community?

Phil sets a great example for this.

Visit his website at www.rbgvlaw.com

In-State Means In-State:  A Quick Overview of the Residency Requirements for In-State Tuition at Florida’s Public Universities – It’s Not What You Think It Is

By: Alan S. Gassman and Eric Brooks

We are fortunate to have a very good university system in Florida.  Many of us had not expected that this would ever occur.

The difference between being a Florida resident and not being a Florida resident for tuition purposes is significant.

The following are the full-time annual tuition amounts that someone would expect to pay to go to Florida’s 4 largest state universities and selected private schools for the 2013 – 2014 academic year (based on 30 credit hours).

Name of University  Number of Students  Floridian Tuition  Non-Floridian Tuition
 University of Florida 32,776 $6,263.10 $28,540.20
Florida State University 32,171 $6,506.50 $21,673.00
University of South Florida (Tampa) 30,289 $6,409.70 $19,664.90
University of Central Florida 50,968 $6,317.10 $22,415.40
Flagler College (private) 2,588 $16,180.00 $16,180.00
University of Miami (private) 10,590 $41,580.00 $41,580.00
Rollins College (private) 1,884 $41,460.00 $41,460.00

*The above assumes that the student takes off the summer to catch up on Thursday Report readings and work at Kentucky Fried Chicken!

 

There is obviously a staggering difference between what a Floridian and a non-Floridian will pay at the state schools.

What does it take to be a Floridian for tuition purposes?

That answer can be as complicated as many tax questions, and advance planning may be essential.

In 2005 the Florida Board of Governors standardized the residency requirements for in-state tuition at all public universities.

Gone are the days of paying out-of-state tuition for the first year, staying around during the summer to qualify for in-state tuition thereafter.  That is still possible, but no longer simple.

Here is the methodology to follow to determine whether in-state tuition is possible:

A.        Is the student dependent or independent?  If the student is independent then you can skip to Step C below.

Your family must determine if the student will be classified as “dependent” or “independent.”  The State of Florida defines a dependent child for tuition purposes as a person who is eligible to be claimed by his or her parent as a dependent (aka, “a qualifying child”) under the federal income tax code.

To qualify as a dependent, all four of the following four tests must be met:

1. Relationship Test – the student meets the relationship test if he or she is a child or stepchild (whether by blood or adoption), foster child, sibling or stepsibling, or a descendant of one of these. 25 U.S.C.A. § 152(d)(2) (West 2013).

2. Residence Test – the student must have “the same principal place of abode as the [parent/guardian] for more than one-half of such taxable year. 25 U.S.C.A. § 152(c)(1)(B).

3. Age Test – the student must be younger than the parent/guardian claiming the student as a dependent and is under the age of 24. 25 U.S.C.A. § 152(c)(3).

4. Support Test – the student seeking dependency must not have provided more than one-half of his or her own support for the year. 25 U.S.C.A. § 152(c)(1)(D).

B.        Which family member will be used to qualify the student as a resident for in-state tuition?

Once you have determined whether the student is dependent or independent you can then decide which family member will be the basis for your student’s residency claim.  If you decided that the student was independent, the student will be used as the basis for residency.  The more common determination is that the student is still a dependent.  In this case, either parent can be used as the basis for determining residency.  This leads us to our final and most important question;

C.        Does the family member claiming residency qualify as a Florida resident for tuition purposes?

The student or parent claiming residency must have established a legal residence in Florida and maintained that residence for at least 12 consecutive months immediately prior to the student’s initial enrollment in an institution of higher education. There must also be proof that the claimed residency is the product of a “bona fide” domicile, which is one’s intention to reside in Florida in comparison to a temporary arrangement made in order to qualify for a lower tuition rate.

What follows is the (nonexhaustive) statutory list of potential forms of residency evidence a college or university’s admissions department would evaluate when considering a claim for Florida residency.

Verification of residency includes two or more of the following documents:

1. The documents must include at least one of the following:

  1. A Florida voter’s registration card.
  2. A Florida driver’s license.
  3. A State of Florida identification card.
  4. A Florida vehicle registration.
  5. Proof of a permanent home in Florida which is occupied as a primary residence by the individual or by the individual’s parent if the individual is a dependent child.
  6. Proof of a homestead exemption in Florida.
  7. Transcripts from a Florida high school for multiple years if the Florida high school diploma or GED was earned within the last 12 months.
  8. Proof of permanent full-time employment in Florida for at least 30 hours per week for a 12-month period.

And may include one or more of the following documents:

    1. A declaration of domicile in Florida.
    2. A Florida professional or occupational license.
    3. Florida incorporation.
    4. A document evidencing family ties in Florida.
    5. Proof of membership in a Florida-based charitable or professional organization.
    6. Any other documentation that supports the student’s request for resident status, including, but not limited to, utility bills and proof of 12 consecutive months of payments; a lease agreement and proof of 12 consecutive months of payments; or an official state, federal, or court document evidencing legal ties to Florida.

Definition of the Week and a Quick Contest

Demur as a verb is defined as: Raise doubts or objections or show reluctance.

Next week’s Thursday Report will cover the noun demur.

Contest: The first five readers who click here will be before everyone else.

Applicable Federal Rates

Below we have this month, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale you can use the lowest of the 3.

SHORT TERM AFRs

MID TERM AFRs

LONG TERM AFRs

August 2013 Annual 0.28% Annual 1.63% Annual 3.16%
  Semi-Annual 0.28% Semi-Annual 1.62% Semi-Annual 3.14%
  Quarterly 0.28% Quarterly 1.62% Quarterly 3.13%
  Monthly 0.28% Monthly 1.61% Monthly 3.12%
July 2013 Annual 0.23% Annual 1.22% Annual 2.80%
  Semi-Annual 0.23% Semi-Annual 1.22% Semi-Annual 2.78%
  Quarterly 0.23% Quarterly 1.22% Quarterly 2.77%
  Monthly 0.23% Monthly 1.22% Monthly 2.76%
June 2013 Annual 0.18% Annual 0.95% Annual 2.47%
  Semi-Annual 0.18% Semi-Annual 0.95% Semi-Annual 2.45%
  Quarterly 0.18% Quarterly 0.95% Quarterly 2.44%
  Monthly 0.18% Monthly 0.95% Monthly 2.44%

The 7520 Rate for August is 2.0% and for July was 1.4%.

Seminars and Webinars

  • FINANCIAL PLANNING ASSOCIATION (FPA) TAMPA BAY 2013 FLORIDA SYMPOSIUM

Alan Gassman will be joining Ken Zahn, CFP for a joint seminar on A Brief Introduction on the Art of Wealth Protection Planning. This seminar will also include a demonstration of our new EstateView Estate Planning Software.  Attendees will also receive a link to download the software to use on their own clients’ matters for a number of weeks.  For more information and to register for this webinar please click here.

Ken Zahn is probably the best known CFP course teacher in the country.  Thousands of certified financial planners have taken Ken’s course, and it is highly recommended for anyone in the financial, legal, or tax services business.  You can access Ken’s excellent website by clicking here.

Date: Monday, August 19, 2013 | 3:00 – 5:00 p.m.

Speakers: Elizabeth Jetton, CFP, Linda Chamberlain, JD, CMC, Ken Zahn, CFP and Alan Gassman, JD, LL.M.

Location: Marriott Westshore Tampa, 1001 N. Westshore Blvd, Tampa, Florida

Additional Information: For more information and to register for this webinar please click here.

  • THE JOINT EXEMPT STEP-UP TRUST (JEST) TELESEMINAR WITH ALAN GASSMAN AND CHRISTOPHER DENICOLO

Many lawyers are using our Joint Exempt Step Up Trust to enable clients in non-community property states to receive a stepped-up basis on all “joint trust assets” on the death of the first dying spouse.  Our Leimberg article on the Joint Exempt Step-Up Trust can be viewed by clicking here and the accompanying chart can be viewed by clicking here.

The Ultimate Estate Planner, Inc. is also featuring our Joint Exempt Step Up Trust forms, client explanation letter and other materials on their website.  To order the forms you can click here.

Date: Wednesday, August 21, 2013 | 12pm Eastern/9am Pacific

Sponsor: The Ultimate Estate Planner, Inc.

Additional Information:  The cost of the teleseminar is $139 for the teleseminar only or $189 if you would like to receive both the teleseminar and the accompanying PowerPoint and downloadable PDF materials.  For more information and to register please click hereThe JEST Trust will also be discussed at the Notre Dame Tax Institute in September by Paul Lee and attorney Barry.

LEGISLATIVE UPDATE – AUGUST 444 SHOW

Join us on Thursday, August 24, 2013 for The 444 Show.  This month we will be speaking on the new legislative update with Sandra Diamond, Aimee Diazlyon and Jim Daughton.  The webinar qualifies for 1 hour of continuing education credit.

Date: Thursday, August 24, 2013 | 4:00 p.m (50 Minutes)

Speakers: Sandra Diamond, Aimee Diazlyon and Jim Daughton

Sponsor: The Clearwater Bar Association.

Additional Information: To register for this webinar please click here or email Janine Gunyan at Janine@gassmanpa.com

  • WHAT CLIENTS ARE AND ARE NOT SUITABLE FOR LONG TERM CARE INSURANCE

Date: Thursday, August 29, 2013 | 5:00 p.m.

Presenter: Rob Cochran

Location: Online webinar

Additional Information: To register for the webinar please click here.

  • AVOIDING THE TRAPS IN EMR/TECH CONTRACTS….NOW YOU TELL ME I’M STUCK WITH THIS FOR 5 YEARS!

Date: Tuesday, September 10, 2013 | 5:00 p.m. and Thursday, September 12, 2013 | 12:30 p.m. (Each webinar will last 30 minutes)

Presenter: Sandra Greenblatt, Board Certified Health Lawyer

Location: Online webinar.

Additional Information: To register for the Tuesday, September 10, 2013, 5pm webinar please click here.  To register for the Thursday, September 12, 2013, 12:30 p.m. webinar please click here.

  • NIP & TUCK: MAKING THE CALL ON OFFICE-BASED SURGERY

Date: Wednesday, September 18, 2013

Presenter: Cheryl White, RN, BS, MSHL, LHRM, LNCC, MSCC, DFHRMPS and Lester Perling, J.D., MHA, PhD, SOB

Location: Online webinar

Additional Information:  To register for the webinar please click here.

  • NORTH SUNCOAST FICPA MONTHLY MEETING

Date: Wednesday, September 18, 2013, 4:30 – 6:30 p.m.

Speakers: Christopher Denicolo and Tom Davis will speak on the Affordable Care Act; Alan Gassman will be speaking on a topic to be determined.

Location: Chili’s in Port Richey

Additional Information: To attend this seminar please email agassman@gassmanpa.com

  • WEDU ESTATE PLANNING SEMINAR  

Gassman Law Associates meets Big Bird – Sesame Street vs. Wall Street?

Alan Gassman will be speaking on the topic of ASSET PROTECTION – ESSENTIAL KNOWLEDGE AND HOT TOPICS

Date: Thursday, September 19, 2013 | 7:30 am – 11:30 am

Location: WEDU PBS Berman Family Broadcast Center

Additional Information:  If you would like to sign up for this seminar please click here.

  • NOTRE DAME TAX INSTITUTE

Jerry Hesch and Alan Gassman will be speaking on the topic of INTERESTING INTEREST QUESTIONS, PLANNING WITH LOW INTEREST LOANS, PRIVATE ANNUITIES, DEFECTIVE GRANTOR TRUSTS, AND PRIVATE AND COMMERCIAL ANNUITIES

      Date: Wednesday, October 16 through Friday, October 18, 2013

      Location: Notre Dame College, South Bend, Indiana

Additional Information: Professor Jerry Hesch’s Notre Dame Tax Institute will once again emphasize the importance of income tax planning and implications in addition to estate, estate tax, and related concepts.  Also Paul and attorney Barry will be discussing stepped-up basis tools and techniques, including our JEST Trust.

We welcome questions, comments and suggestions for the presentation that we are assisting Jerry in preparing and presenting.

  • PINELLAS COUNTY ESTATE PLANNING COUNCIL HALF-DAY SEMINAR

Alan Gassman will be speaking on the topic of HOT TOPICS FOR ESTATE PLANNERS

Date: Wednesday, October 23, 2013 | 8:00 am – 12:00 p.m. (60 MINUTE PRESENTATION)

Location: TBD

Other Speakers: Other speakers include Barry Flagg on Insurance and Estate Planning; Sean Casey, SR. VP Fifth Third Bank on an Economic Update, and Sandra Diamond on a topic to be determined.

Additional Information: To attend the meeting or to receive information on joining the Council please click here or email agassman@gassmanpa.com

  • 2013 MOTE VASCULAR SURGERY FELLOWS – FACTS OF LIFE TALK SEMINAR FOR FIRST YEAR SURGEONS

Alan Gassman will be speaking on the topic of ESTATE, MEDICAL PRACTICE, RETIREMENT, TAX, INSURANCE, AND BUY/SELL PLANNING – THE EARLIER YOU START THE SOONER YOU WILL BE SECURE

Date: October 25 – 27, 2013 | Times TBD

Location: TBD

Additional Information: Please contact agassman@gassmanpa.com for additional information.

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE) HEALTH LAW SYMPOSIUM – AN ALL DAY SEMINAR

Alan Gassman will be speaking on the topic of WHAT HEALTH LAWYERS NEED TO KNOW ABOUT FLORIDA LAW

Date: Friday, November 1, 2013 | 9am – 5pm (Mr. Gassman speaks from 1:10 pm until 2:10 p.m.)

Location: Seton Hall Law School, Newark, New Jersey

Additional Information: Seton Hall University in South Orange, New Jersey was founded in 1856, and they have remodeled since.  Today, Seton Hall has over 10,000 students in its undergraduate, graduate and law school programs and is in close proximity to several Kentucky Fried Chicken locations.

DECODING HEALTHCARE SEMINAR

Alan Gassman will be moderating the Decoding Healthcare Seminar hosted by Fifth Third Bank.

Date: Tuesday, October 29, 2013

Location: Grand Hyatt, 2900 Bayport Drive, Tampa, Florida

Additional Information: For more information on this event please email agassman@gassmanpa.com

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE)_SPECIAL 3 HOUR SESSION

Alan Gassman will be speaking on the topic of WHAT NEW JERSEY LAWYERS NEED TO KNOW ABOUT FLORIDA LAW – A 3 HOUR OVERVIEW BY ALAN S. GASSMAN

Date: Saturday, November 2, 2013

Location: Wilshire Grand Hotel, West Orange, New Jersey | 9am – 12pm

Additional Information: Please tell all of your friends, neighbors and enemies in New Jersey to come out to support this important presentation for the New Jersey Bar Association.  We will include discussions of airboats, how to get an alligator off of your driveway, how to peel a navel orange and what collard greens and grits are. For additional information please email agassman@gassmanpa.com

  • SALT LAKE CITY ESTATE PLANNING COUNCIL’S FALL ONE DAY “TAX AND DEDUCTIBILITY OF YOUR SKI TRIP” INSTITUTE

Alan Gassman will be speaking on the topic of PRACTICAL ESTATE PLANNING, WITH A $5.25 MILLION EXEMPTION AMOUNT

Date: Thursday, November 7, 2013

Location: Hilton Downtown Salt Lake City, Utah

Additional Information:  Please support this one day annual seminar conveniently located near skiing and tourism opportunities.  If you would like to attend this event or receive the materials please email agassman@gassmanpa.com

  • 1st ANNUAL ESTATE PLANNER’S DAY AT AVE MARIA SCHOOL OF LAW

Speakers: Speakers will include Professor Jerry Hesch, Jonathan Gopman, Alan Gassman and others.

Date: April 25, 2014

Location: Ave Maria School of Law, Naples, Florida

Sponsors: Ave Maria School of Law, Collier County Estate Planning Council and more to be announced.

Additional Information: For more information on this event please contact agassman@gassmanpa.com.

NOTABLE SEMINARS PRESENTED BY OTHERS:

  • MEDITATION, Science, Spirituality, Sustainability – An Experimental Workshop by the Bridge and Maulik K. Trivedi, M.D.

On Saturday, September 28, 2013 from 10 am to 1pm the Bridge, a not-for-profit organization that promotes ecocentric living, social justice and personal development is providing a 3 hour workshop on Meditation.  The session will be administered by integral psychiatrist and Yogi, Dr. Maulik K. Trivedi and will be accompanied by accomplished sitar player, Douglas Werner.  For more information on this event, please click here.

Date: Saturday, September 28, 2013 | 10am – 1pm

Location: Carrollwood Cultural Center, 4537 Lowell Road, Tampa

Additional Details: The cost for attending this workshop is $45 and you can register by clicking here or call 813-416-3069 for more information.

  • THIRD ANNUAL FEDERAL TAX INSTITUTE OF NEW ENGLAND

Date: September 27, 2013

Location: Hartford Marriot Farmington Hotel, Farmington, Connecticut

Sponsor: Connecticut Bar Institute

Additional Information: Chairman Frank Berall will be using part of an earlier Thursday Report article on same-sex planning in his presentation. You can also catch an early dose of Jerry Hesch’s talk on Income Tax Ideas for Estate Planning here before the Notre Dame Tax Institute in October, and Bruce Stone will be speaking on Assisted Reproductive Technology Children.  For more information or to register please visit the Institute’s site here.

  • 48th ANNUAL HECKERLING INSTITUTE ON ESTATE PLANNING SEMINAR

Date: January 13 – 17, 2014

Location:  Orlando World Center Marriott, Orlando, Florida

Sponsor: University of Miami School of Law

Additional Information: For more information please visit: http://www.law.miami.edu/heckerling/

  • 16th ANNUAL ALL CHILDREN’S HOSPITAL ESTATE, TAX, LEGAL & FINANCIAL PLANNING SEMINAR

Date: Wednesday, February 12, 2014

Location: All Children’s Hospital Education and Conference Center, St. Petersburg, Florida with remote location live interactive viewings in Tampa, Sarasota, New Port Richey, Lakeland, and Bangkok, Thailand

Sponsor: All Children’s Hospital

  • THE UNIVERSITY OF FLORIDA TAX INSTITUTE

Date: February 19 – 21, 2014

Location: Grand Hyatt, Tampa, Florida

Sponsor:  UF Law alumni and UF Graduate Tax Program

Additional Information:  Here is what UF is saying about the program on its website: “The UF Tax Institute will provide tax practitioners and other leading tax, business and estate planning professionals with a program that covers the most current issues and planning ideas with a practical, informative, state-of-the-art approach.  The Institute’s schedule will devote separate days or half days to individual income tax issues, entity tax issues and estate planning issues.  Speakers and presentations will be announced as the program date nears to ensure coverage of the most timely and significant topics.  UF Law alumni have formed the Florida Tax Education Foundation, Inc., a nonprofit corporation, to organize the conference.”

For details about each event, please visit us online at gassmanlawassociates.com/newsandevents.html

Thank you to our law clerks that assisted us in preparing this report.

The Thursday Report – Is Col. Sanders in Witness Protection?

Posted on: August 8th, 2013

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“Pleasure in the job puts perfection in the work”

Aristotle

Ken Crotty’s LLC Clinic – Statement of Authority

Pre-Nuptial and Post-Nuptial Agreements: An Interview with noted divorce attorney, Ky Koch and Judge George Jirotka – Part 1 of a 7 Part Series

Clayton Kreis’ Excellent Advisor Checklist

Four Questions Asked by a New Doctor Approached by Various Salespeople

Great Morning Tampa Event for WEDU PBS

Back by Popular Demand – More Ogden Nash Poems

Research on Google 

IS ANYONE INVESTIGATING COLONEL SANDERS, AND WHY? 

While Colonel Sanders reportedly died in 1980, perhaps he was hidden away because of the FBI’s 1970 investigation file.  Perhaps the opening of the new KFC “11″ stores that will not feature his likeness or name is a further step in this direction.  In 1970 Colonel Sanders sent J. Edgar Hoover an invitation to his 80th birthday party and promised to provide him with a bribe – personalized transportation if he would attend.  J. Edgar Hoover did not attend. Click here to read the letter from Colonel Sanders to Hoover.

It may or may not be true that the government is still investigating many of these people, and those who have associated with him, but it is not true that Alan S. Gassman has gone into hiding.  Nevertheless, changing identities can sometimes be a good thing.  Click here to see a possible costume that would confuse even the best federal agencies.

We welcome contributions for future Thursday Report topics. If you are interested in making a contribution as a guest writer, please email Janine Gunyan at Janine@gassmanpa.com.

This report and other Thursday Reports can be found on our website at www.gassmanlawassociates.com.

Our LLC Clinic – Statement of Authority Rules by Ken Crotty and Alan S. Gassman

Have you ever wondered what prevents someone from making themselves a Manager of an LLC on Sunbiz and proceeding to buy or mortgage real estate, or go to a bank and withdraw money without the knowledge or approval of the LLC owners?

The new Statement of Authority law that was passed this year provides that third parties will be bound by appropriately filed Statements of Authority under the circumstances described below.

Drafting and maintaining an appropriate Statement of Authority will therefore be a very important function for those of us who form and/or maintain limited liability companies.

This law arises under Florida Statute Section 605.0302, which you can read by clicking here.

Please note that to be binding upon real estate the Statement of Authority must be not only filed with the Secretary of State, but a certified copy of the Statement has to be recorded in the public records of the county where the real property is located.

One of the new items introduced by the 2013 Florida LLC Act is the concept of a Statement of Authority (“Statement”). Pursuant to Section 605.0302 of the Act, a limited liability company may now file a Statement with the department.

The Statement can specify the authority or limitation of authority for Members, Managers, Officers, and others to act. The Statement can also provide that one or more of such individuals have the authority or do not have the authority to do any of the following:

1. Execute an instrument;

2. Transfer real property held in the name of the LLC;

3. Enter into transactions on behalf of the LLC; and

4. Act for or bind the LLC

It is important to note that Statements of Authority will expire five years after they have been filed, so a calendar system needs to be set up for this. The Amendment of a Statement will be considered an extension so that the 5 years restarts upon the filing of the Amendment.

Any Amendment or cancellation must include the name of the LLC, the street and mailing address of its principal office, the date the Statement became effective, and a description of how the original Statement is being amended or a declaration that the original Statement is being cancelled.

If a Statement has been filed which grants authority to an individual (except for transfers of real property) and a third person gives value in reliance on this Statement, then such person is entitled to rely on the Statement unless (a) the person had knowledge to the contrary; (b) the Statement had been amended or cancelled; or (c) another Statement limiting the authority had been filed.

For transfers of real property, if a certified copy of the Statement has been filed in the appropriate recording office then a person who gives value in reliance on this Statement is entitled to rely on the Statement unless (a) the Statement had been amended or cancelled and a certified copy of the amendment or cancellation has been filed with the appropriate recording office; or (b) another certified Statement limiting the authority had been filed with the appropriate recording office.

Therefore, if the LLC is concerned that an individual or entity may attempt to transfer real estate owned by the LLC, then the LLC should file a certified Statement of Limitation with the appropriate recording office. If a certified Statement of Limitation is filed, then all persons are deemed to know of the limitation contained in the Statement of Authority and the property would be protected. Because of this, practitioners should be filing Statements of Authority for their clients’ LLCs in the counties where the LLCs have real property to provide additional protection for these assets.

Generally when Articles of Dissolution are filed or a termination of an LLC occurs this cancels any Statements of Authority that the LLC filed. It is possible for the LLC to record a Statement of Authority which is designated as a post-dissolution Statement of Authority to grant a person or entity the authority or limit the authority of a person or entity to transfer real property that had been owned by the LLC.

If a person disassociates from an LLC or resigns from an LLC and such person files a Statement of Resignation pursuant to Section 605.0216, this Statement of Resignation will terminate the authority of the person contained in the original Statement.

Section 605.0303 of the Act provides that a person who has been granted authority in a Statement may deny the authority. Such person must file a Statement with the department signed by the person that provides the name of the LLC, the caption of the Statement of Authority to which the statement or denial pertains, and that the person denies the grant of authority.

If you would like to read the entire Florida Statute Section 605, please click here.

Pre-Nuptial and Post-Nuptial Agreement Traps and Strategies – A Very Interesting Interview with Board- Certified Family Lawyer Ky Koch and Judge George Jirotka – Part 1 of a 7 Part Series

Koch and Jirotka

Alan Gassman was fortunate enough to interview Ky Koch and Judge George Jirotka in a Clearwater Bar sponsored 444 Show on Thursday, May 23, 2013.  The 50 minute recording of this interesting webinar, along with an informative PowerPoint presentation, can be purchased from the Clearwater Bar Association for $30 (less than 2 buckets of chicken – but if you have the choice go for the chicken) by clicking here.  The webinar qualifies for 1 hour of continuing education credit and is an extremely interesting and informative presentation.

Ky Koch is a board certified marital and family lawyer with the firm of Koch and Hoffman, P.A.  He has been practicing law since 1978.  He is a fellow of the American Academy of Matrimonial Lawyers and the International Academy of Matrimonial Lawyers.  Mr. Koch has also previously served as President of the Clearwater Bar Association and can be reached at kkoch@kh-pa.com or 727-446-6248.

Judge George M. Jirotka is a judge of the Sixth Judicial Circuit in Pinellas County.  He received his master’s degree in business administration from the University of Chicago and his law degree from the University of Texas and was admitted to the Bar in 1983.  Prior to becoming a judge, he worked for Fowler White Boggs Banker in the Government, Environmental and Land Department Real Estate Practice Group.  Judge Jirotka also served as mayor of Belleair Shores from 1991 until 1998.

Part One of this series introduces the reader to the present overall status of prenuptial agreement statutory law and caselaw, and talks about prominent malpractice traps and how to get clients prepared for what they can encounter in the prenuptial agreement universe.

  • On Thursday, August 15, 2013, How much disclosure is enough disclosure, whether both parties need to have lawyers, and questions to ask the lawyer or spouse you are not representing to document appropriate disclosure and circumstances by video-taped interview or written correspondence.
  • On Thursday, August 22, 2013, Whether both parties need to have lawyers, and questions to ask the lawyer or spouse you are not representing to document appropriate disclosure circumstances by video-taped interview or written correspondence.
  • On Thursday, August 29, 2013, Discussion of Castro v. Castro and Belcher v. Belcher, and what they mean for clients and lawyers who are involved in the pre and post nuptial agreement planning.
  • On Thursday, September 5, 2013, Alimony and lawyer fee obligations that may not be waivable in pre-nuptial or post nuptial agreements, and offset clauses and other ways to handle these.
  • On Thursday, September 12, 2013, Bifurcation – whether you can require the validity of the pre-nuptial or post-nuptial agreement be litigated or also before having to also litigate what the result could be if it is or is not enforceable.
  • On Thursday, September 19, 2013, How to keep marital and asset information confidential in a divorce scenario, arbitration, and the Roddy v. Roddy case.

Below is part 1 of the 7 part interview:

Alan Gassman: Ky and Judge Jirotka, thank you so much for being here with us today.  You both have a significant amount of knowledge in the family law area, and with respect to the new Florida Statute Section 61.079, which is entitled the Uniform Premarital Agreement Act and was enacted effective October 1, 2007.

Ky Koch: Thanks Alan.  By way of background, this act came into effect in Florida in 2007.  There are now 26 states that have some form of this law, and though not identical, most of them are awfully close in nature.  Since it was enacted in 2007, we don’t have any case law interpreting it in Florida.  It’s a relatively short time to have negotiated a pre-nuptial agreement, been married, divorced, and be up on appeal.  I’m sure we’ll be seeing some cases here real soon, because six years is about the right time to get from point A to point B.

The Uniform Act was meant to make the drafting, interpretation and enforcement of pre-marital agreements much more predictable and frankly, easier to enforce.  It has pretty much embodied the case law that existed prior to that time and streamlined it into a one page statute.

The bottom line of this new statute is that the prenuptial agreement must be in writing and must have been signed by each of the two parties.  That’s also in the prior case law.  Consideration for a prenuptial agreement only needs to be the marriage itself.  There need not be any other particular consideration, and that’s embodied very explicitly in the statute.

Amendment and abandonment of the agreement can only occur also upon a written or signed agreement.  Here’s where we get into the items that Judge Jirotka sees, I’m sure on almost a daily basis, and that is how do you set aside a prenuptial agreement?  Perhaps you could comment on that for us, Judge.

Judge Jirotka: Well we don’t see them all that often in terms of being contested.  It may have to do with the fact that the prenuptial agreements are usually entered into not in a first marriage, but rather the second and subsequent marriages.  They generally are entered into by spouses that come into the marriage with unequal footing.

The issues that we most often see are involuntary execution, fraud, duress, coercion, overreaching, and largely the issue of unconscionability, ‘he or she didn’t tell me what he or she owned,’ or financial disclosure, ‘he or she made me sign this two minutes before the priest came in.’

Ky Koch: ‘Hey honey, I’ve got something for you to look at.’

Judge Jirotka: Exactly!  The ones that I have seen as a judge fall into two categories.  One is lack of full disclosure or the allegation of lack of full disclosure.  I’d say of the cases that I’ve seen, that’s got to be 75% or higher.  The remaining cases that I’ve seen are he or she gave it to me after we signed the caterer’s agreement or something like that.

Ky Koch: Whether it was pressure bearing from the wedding contingency?

Judge Jirotka: Right, the invitations already went out.  Those are the two areas that we see the most.

Ky Koch: I would agree.  You know as a practitioner several issues come up. I have seen from personal experience that prenuptial agreements are a malpractice trap extraordinaire for a million reasons.

One reason is that the law changes over time.  Two is you are virtually trying to crystal ball a situation where people’s assets and debts are frozen in time as of today – the day you’re drafting the pre-nup until what happens 15, 20 years from now.  That’s virtually impossible as we all know, and circumstances change.  Trying to address all of those eventualities in a form of a written document is difficult.

I try to charge as much money as I can get out of my mouth when quoting a fee because these things are so darned hard.  People are in love and wanting to get married and excited about the wedding and have family coming in, and at the same time you’re negotiating their divorce.  And it is just hard.  There is no other way to describe it.

Alan Gassman: It’s a character test.  The client tells us that the spouse-to-be is absolutely in love with the client, but then this love seems to be tested when a reasonable prenuptial agreement is presented, and the person who loves my client so much no longer seems to love him or her as much when the monetary rewards for marriage are reduced.

Fairness is in the eye of the beholder, and it’s an interesting dynamic because of the emotions that are swirling around the negotiations.  You, as the lawyer, are expected to keep them together as a couple and negotiate their divorce for them at the same time, and it is not easy.

Judge Jirotka: Ky, what percentage would you say that you negotiate as being the first drafter as opposed to being the receiving attorney?

Ky Koch: Well it’s a lot easier being on the receiving side, because typically that is the less-wealthy spouse you are working for.  When you’re drafting, it’s the monied spouse.  That’s where the issues come and that’s where the rubber meets the road.  It’s much more difficult from that side than it is from the receiving side.  I think I probably see about 50% of each.

Alan Gassman: What do you tell your clients when you get them successfully divorced about their next love event and marriage?  How do you prep that?  What are your clients’ preconceptions about prenuptial agreements?  They must ask you about it during the divorce as they contemplate their next situation.

Ky Koch: I get asked that a lot and I tell them that I am a proponent of prenuptial agreements. They work. And they are enforceable in the State of Florida.  I tell them basically what we just talked about here, which is that they are very difficult because of the dynamics in the relationship while you’re negotiating their potential divorce.  I also tell them that when you negotiate a prenuptial agreement you are buying yourself perhaps two phases of litigation in divorce.

The first one is a phase of ligation dealing with validity or invalidity of the agreement, and if that doesn’t go so well a second phase is the divorce itself.  In doing a prenuptial agreement, typically the non-monied spouse has nothing to lose by litigating, because the worst they’re going to get is the enforcement of the prenup.  It only goes up from there, so that’s an issue that I think everybody’s got to look at when they talk about a prenuptial agreement.

Judge Jirotka: I agree, and temporary fees cannot be prohibited by the prenup.

Ky Koch: Yep, that’s true.  Judge Jirotka’s talking about the Belcher v. Belcher case out of our Supreme Court, which says that temporary attorney fees and temporary support cannot be signed away.  If they are addressed in the prenuptial agreement they’re unenforceable, and the court is duty bound to impose temporary alimony and temporary attorney fees.

Alan Gassman: Can that come out of eventual other things that happen?  Can they reduce the eventual property settlement?

Ky Koch: I have attempted that in the few prenuptial agreements I’ve done recently, where you set off against an ultimate award whatever the court order is for temporary alimony and temporary fees.  There’s case law on the topic that goes both directions.  I’m not convinced that you can do that, but why not build it into an agreement?  There’s no downside to trying it.

We thank Ky Koch and Judge Jirotka for their expert advice on this subject.

Stay tuned for next week’s discussion!

Clayton Kreis Checklist

Kreis with quotes

 

Clayton Kreis of Garcia & Ortiz, P.A. was kind enough to share the non-tax items from his excellent Year-End Planning Checklist that he provides for all corporate clients.

We were impressed at how he succinctly and efficiently covers many practical matters that client should be reminded to attend to periodically.

Clayton is truly a renaissance advisor when it comes to what he does for clients of the Garcia & Ortiz firm in St. Petersburg.  His consulting services include tax planning, compliance, financial reporting, structuring buy/sell agreements, accounting software implementation, fringe benefit programs, administration, financial budgeting, compensation planning, sales and purchases of businesses, and restructuring professional associations, as well as a wide variety of investment advisory consulting experience.

Excerpts from Clayton’s checklist are shown below.

1. Legal

a. Meet annually with your corporate attorney to review your Employment Contracts, Buy/Sell Agreements and other arrangements to ensure compliance with both federal and state laws.

b. Review your real estate lease to verify the renewal date.

c. Prepare yourself to negotiate leases in advance of due date to be sure you maximize your alternatives.

d. Confirm you are paying sales tax on all commercial leases.

e. Review terms and purchase options on equipment leases. Maintain a list of lease termination dates.

f. Update your corporate minutes annually. The increase in Federal and State audits may result in a request of your corporate minutes to verify compliance.

g. Review your Annual Report filed with the Florida Department of State for correct listing of officers, directors, and registered agent. This filing is due May 1 each year to avoid late filing penalties, or losing your corporate status.

h. Review your personal estate plan – Wills, Trusts, Durable Powers of Attorney, and Living Wills. Potential changes are possible in the next few years.

i. Review all legal documents that are older than five years.

j. Review your asset protection strategy, when applicable, with legal counsel.

k. Review unclaimed property with legal counsel. Property held by your company on behalf of others, such as un-cashed checks, deposits, credit balances, etc., may be owed to the State of Florida.

2. Insurance

a. Meet annually with your life, property, casualty, and workers’ compensation insurance agent. Confirm your policy coverage meets the business needs. Analyze the cost benefit of increasing your deductible to reduce the premium cost.

b. Review policy beneficiaries annually.

c. Identify with your insurance agent the areas of risk that may lack coverage, such as cyber security or business use of an employee owned vehicle.

d. Review your business and personal umbrella liability coverage.

e. Review your business interruption insurance coverage and deficiencies.

f. Review your disability insurance coverage. Identify age limitations and other policy limitations. Determine the time frame you need disability insurance and who should pay the premiums. Evaluate the tax benefit of having the premiums paid personally. Review benefits vs. cost if you are 65 years or older.

g. Review life insurance needs. Understand the advantages and disadvantages of the different types of products offered. Verify the accumulation value of your policy annually. Discuss with the agent any changes that have occurred.

h. Loans against life insurance policies can result in taxable gains upon sale, surrender, or exchanges. Review tax implications prior to changes.

i. Review your long term care insurance needs.

j. Obtain quotes on your health insurance policy 60 days in advance of the renewal date. Review with your agent the current trends businesses are utilizing, such as Health Savings Accounts, increased deductibles, different carriers, company payment, etc.

k. If you utilize an employee leasing company and plan on discontinuing or starting the service, schedule the change to occur at the end of the calendar year.

3. Employees

a. Consult with legal counsel regarding labor laws and classification issues.

b. Review the job description and duties of employees to confirm they are exempt from overtime compensation.

c. Non exempt employees are entitled to overtime compensation.

d. Review your workers’ compensation insurance to verify the proper classification of your employees.

e. “Moonlighting” professional employees may present liability issues. Please review with your insurance agent and legal counsel.

f. Perform financial and criminal background checks on all employees. Monitor possible changes in the law that may disallow some of these checks.

4. Employee Manuals

a. Review your employee manual annually for compliance and updates.

b. Changes to employee manuals should supersede prior releases.

c. Legal counsel should review the employee manual for compliance with state and federal employment laws.

5. Independent Contractors

a. Review the duties of those you pay for contract services. The tax implications for improperly compensating an individual as a contract laborer v. an employee are material.

b. Obtain Form W-9 from each independent contractor prior to paying for services.

c. Obtain proof of workers’ compensation insurance from each independent contractor.

d. Create a contract detailing the agreement between the company and the contractor. Clarify the treatment and responsibility of payroll taxes.

6. Cash Management

a. Maximize interest earnings on idle funds with money market accounts or other short-term investment instruments.

b. Evaluate budget expectations for managing cash levels in excess of operating and capital expectations.

c. Review outstanding debts, maturity schedules, and interest rates being paid.

d. Review all electronic withdrawals reflected on the bank statement monthly. Verify the payments are for authorized business expenses. There is a substantial increase in fraud regarding electronic banking which requires an extra effort from management.

e. Coordinate the payment of debts with depreciation expense to control the tax impact of taxable income for cash basis taxpayers.

f. Evaluate and monitor the interest rate on your CD’s and money market accounts. Review the CD maturity dates.

g. Confirm the FDIC insurance limits on your bank account(s). Reduce concentration of cash holdings in excess of FDIC limits.

7. Debts

a. Loans made by principals and officers to the business should be documented. Interest should be paid at least annually.

b. Review collateral agreements and debt covenants for compliance.

c. Anticipate renewal terms for lines of credit.

d. Meet with your banker annually to discuss financial trends, financing needs, and debt management. Consider bringing your independent CPA to this meeting to discuss your business plan.

8. Corporate Dividends

a. C corporations that accumulate profits without paying dividends could be subject to an accumulated earnings tax. Review the retained earnings and consider a dividend policy.

b. S corporation owners need to verify they have sufficient tax basis prior to issuing a distribution. Distributions in excess of tax basis may cause additional tax consequences.

9. Retirement Plans

a. Retirement plans are a great way to accumulate funds tax deferred. If possible, contribute the maximum amount allowed by the plan.

b. Verify with the plan sponsor that your plan is in compliance with current laws.

c. Periodically obtain an IRS favorable determination letter of your plan’s tax qualification.

d. Plan fiduciaries and trustees must obtain a Fidelity Bond to protect the plan against losses caused by fraud or dishonesty by those that control plan assets. The Fidelity Bond coverage is generally 10% of plan asset value.

We thank Clayton for his excellent checklist.  His contact information is as follows:

Clayton Kreis
Garcia & Ortiz, P.A.
888 Executive Center Drive West
Suite 101
St. Petersburg, FL 33702
Telephone: (727) 497-9455
Email: ckreis@garciaortiz.com

Four Questions Asked by a New Doctor Approached by Various Salespeople

Lester Perling has been kind enough to offer us answers to some of the pressing questions that new doctors after interaction with “well meaning salesmen”.  We hope that the doctors earn more than the salesmen.

1.  A lab company wants me to draw labs in the office and they are going to pay 20% of the drawing fee, is this legal?

LP:  This would be a problematic relationship.  Most payers, including Medicare, pay for phlebotomy (“the practice of drawing blood”).  They do not pay much, but they pay nonetheless.  The doctor should bill his or her own draw fees. 

Also, if there are Medicare patients involved this would create a Stark financial relationship and there would not be an exception because the payment would vary, it appears, with the volume of referrals by the doctor to the lab.  This would mean the doctor would be prohibited from referring Medicare/Medicaid patients to the lab.

2. A medical supply company wants to keep back braces in my office, and if I prescribe them to the patient they will give a $40 “fitting fee.”

LP:  This sounds like a kickback problem to me.  To my knowledge this would not be legitimate payment but perhaps there are facts with regard to the codes that would be billed.  In any event, I would still have kickback concerns and this has the same Stark problem as question 1.

3. A pharmaceuticals company wants me to have stock of medications (not controlled) and dispense to patients.

LP:  I do not have enough facts here.  It appears that you might be talking about a company that helps physicians become dispensing practitioners – they act as consultants and suppliers.  Those relationships, if structured properly, can be permitted.  There are a number of reputable companies who can help a physician’s office sell pharmaceuticals and comply with the many laws that apply.  These have become very popular with physicians who service HMO contracts because they can make sure that the patient has the medication in hand and has actually taken the first dose before he or she leaves the doctor’s office. 

4. A company who has device to check for dizziness wants to come in and do it in my office, I have to charge insurance – about $400 and pay them $150 out of it.

LP:  I would need more facts to give a better answer.  If this company is itself NOT a provider, i.e. they only provide the equipment and tech and in no situation do they bill payers themselves, this may be allowed. This could be subject to the Medicare mark-up limitation but would likely fit an exception.   Note, however, that Medicare (the primary payer for these services) has grave concerns about overutilization and this has been the basis for many audits/overpayments.  If the doctor is going to offer this service she will need to research Medicare requirements and be meticulous about her documentation of medical necessity etc.  There are other details related to FL Patient Self-Referral Act that would be relevant if she moves forward, but would not prohibit the service. 

Lester Perling can be contacted by email at lperling@broadandcassel.com.  He is the co-author of A Practical Guide to Kickback and Self-Referral Laws for Florida Physicians with Alan Gassman, which can be ordered or previewed by clicking here.

Do Not Miss This Great Thursday a.m. September 19th Continuing Education and Networking Tampa Event for WEDU Television!

Do not miss the Thursday, September 19, 2013, 7:30 – 11:30 a.m. WEDU PBS program, which is announced below.  Free copies of our September 19th Thursday Report will be distributed, making this seminar more than worthwhile.  In fact, anyone signing up for this seminar will be entitled to a free extra copy of the Thursday Report delivered to the email address of your choice.

 

PBS Flyer

All attendees will receive a free copy of Alan Gassman’s book Creditor Protection for Florida Physicians which is published by Haddon Hall publishing. To purchase tickets to this event, please click here.

Back by Popular Demand – More Ogden Nash Poems

The Canary

The song of canaries

Never varies,

And when they’re molting

They’re pretty revolting.

The Cobra

This creature fills its mouth with venom

And walks upon its duodenum.

He who attempts to tease the cobra

Is soon a sadder he, and sobra.

The Cow

The cow is of the bovine ilk;

One end is moo, the other, milk.

The Eel

 I don’t mind eels

Except as meals.

The Guppy

Whales have calves,

Cats have kittens,

Bears have cubs,

Bats have bittens,

Swans have cygnets,

Seals have puppies,

But guppies just have little guppies.

-Ogden Nash

Research on Google

            If you want to see a write-up of any topic that has been covered in our Thursday Reports just search “Thursday Report Gassman” and type in the topic and you will find that every Thursday Report covering that topic comes up.  Google directs you right to the page where that topic begins.  You can also search our website directly by using the search box on the top right hand side of the page.  This way you can search not only the Thursday Report but the other resources on our website.  You can view our website by clicking here.  Rumors that the Thursday Report has acquired Google are strenuously denied.

Applicable Federal Rates

Please click here to view a chart of this month’s, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale you can use the lowest of the 3.

Seminars and Webinars

  • FINANCIAL PLANNING ASSOCIATION (FPA) TAMPA BAY 2013 FLORIDA SYMPOSIUM

Alan Gassman will be joining Ken Zahn, CFP for a joint seminar on A Brief Introduction on the Art of Wealth Protection Planning. This seminar will also include a demonstration of our new EstateView Estate Planning Software.  Attendees will also receive a link to download the software to use on their own clients’ matters for a number of weeks.  For more information and to register for this webinar please click here.

Ken Zahn is probably the best known CFP course teacher in the country.  Thousands of certified financial planners have taken Ken’s course, and it is highly recommended for anyone in the financial, legal, or tax services business.  You can access Ken’s excellent website by clicking here.

Date: Monday, August 19, 2013 | 3:00 – 5:00 p.m.

Speakers: Elizabeth Jetton, CFP, Linda Chamberlain, JD, CMC, Ken Zahn, CFP and Alan Gassman, JD, LL.M.

Location: Marriott Westshore Tampa, 1001 N. Westshore Blvd, Tampa, Florida

Additional Information: For more information and to register for this webinar please click here.

  • THE JOINT EXEMPT STEP-UP TRUST (JEST)

Many lawyers are using our Joint Exempt Step Up Trust to enable clients in non-community property states to receive a stepped-up basis on all “joint trust assets” on the death of the first dying spouse.  Our Leimberg article on the Joint Exempt Step-Up Trust can be viewed by clicking here and the accompanying chart can be viewed by clicking here.

The Ultimate Estate Planner, Inc. is also featuring our Joint Exempt Step Up Trust forms, client explanation letter and other materials on their website.  To order the forms you can click here.

Date: Wednesday, August 21, 2013 | 12pm Eastern/9am Pacific

Sponsor: The Ultimate Estate Planner, Inc.

Additional Information:  The cost of the teleseminar is $139 for the teleseminar only or $189 if you would like to receive both the teleseminar and the accompanying PowerPoint and downloadable PDF materials.  For more information and to register please click here.

  • WHAT CLIENTS ARE AND ARE NOT SUITABLE FOR LONG TERM CARE INSURANCE

Date: Thursday, August 29, 2013 | 5:00 p.m.

Presenter: Rob Cochran

Location: Online webinar

Additional Information: To register for the webinar please click here

  • AVOIDING THE TRAPS IN EMR/TECH CONTRACTS….NOW YOU TELL ME I’M STUCK WITH THIS FOR 5 YEARS!

Date: Tuesday, September 10, 2013 | 5:00 p.m. and Thursday, September 12, 2013 | 12:30 p.m. (Each webinar will last 30 minutes)

Presenter: Sandra Greenblatt, Board Certified Health Lawyer

Location: Online webinar.

Additional Information: To register for the Tuesday, September 10, 2013, 5pm webinar please click here.  To register for the Thursday, September 12, 2013, 12:30 p.m. webinar please click here.

  • NIP & TUCK: MAKING THE CALL ON OFFICE-BASED SURGERY

Date: Wednesday, September 18, 2013

Presenter: Cheryl White, RN, BS, MSHL, LHRM, LNCC, MSCC, DFHRMPS and Lester Perling, J.D., MHA, PhD, SOB

Location: Online webinar

Additional Information:  To register for the webinar please click here.

  • NORTH SUNCOAST FICPA MONTHLY MEETING

Date: Wednesday, September 18, 2013, 4:30 – 6:30 p.m.

Speakers: Christopher Denicolo and Tom Davis will speak on the Affordable Care Act; Alan Gassman will be speaking on a topic to be determined.

Location: Chili’s in Port Richey

Additional Information: To attend this seminar please email agassman@gassmanpa.com

  • WEDU ESTATE PLANNING SEMINAR  

Gassman Law Associates meets Big Bird – Sesame Street vs. Wall Street?

Alan Gassman will be speaking on the topic of ASSET PROTECTION – ESSENTIAL KNOWLEDGE AND HOT TOPICS

Date: Thursday, September 19, 2013 | 7:30 am – 11:30 am

Location: WEDU PBS Berman Family Broadcast Center

Additional Information:  If you would like to sign up for this seminar please click here.

  • NOTRE DAME TAX INSTITUTE

Jerry Hesch and Alan Gassman will be speaking on the topic of INTERESTING INTEREST QUESTIONS, PLANNING WITH LOW INTEREST LOANS, PRIVATE ANNUITIES, DEFECTIVE GRANTOR TRUSTS, AND PRIVATE AND COMMERCIAL ANNUITIES

Date: Wednesday, October 16 through Friday, October 18, 2013

Location: Notre Dame College, South Bend, Indiana

Additional Information: Professor Jerry Hesch’s Notre Dame Tax Institute will once again emphasize the importance of income tax planning and implications in addition to estate, estate tax, and related concepts.  Also Paul and attorney Barry will be discussing stepped-up basis tools and techniques, including our JEST Trust.

We welcome questions, comments and suggestions for the presentation that we are assisting Jerry in preparing and presenting.

  • PINELLAS COUNTY ESTATE PLANNING COUNCIL HALF-DAY SEMINAR

Alan Gassman will be speaking on the topic of HOT TOPICS FOR ESTATE PLANNERS

Date: Wednesday, October 23, 2013 | 8:00 am – 12:00 p.m. (60 MINUTE PRESENTATION)

Location: TBD

Additional Information: To attend the meeting or to receive information on joining the Council please click here or email agassman@gassmanpa.com.

  • 2013 MOTE VASCULAR SURGERY FELLOWS – FACTS OF LIFE TALK SEMINAR FOR FIRST YEAR SURGEONS

Alan Gassman will be speaking on the topic of ESTATE, MEDICAL PRACTICE, RETIREMENT, TAX, INSURANCE, AND BUY/SELL PLANNING – THE EARLIER YOU START THE SOONER YOU WILL BE SECURE

Date: October 25 – 27, 2013 | Times TBD

Location: TBD

Additional Information: Please contact agassman@gassmanpa.com for additional information.

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE) HEALTH LAW SYMPOSIUM – AN ALL DAY SEMINAR

Alan Gassman will be speaking on the topic of WHAT HEALTH LAWYERS NEED TO KNOW ABOUT FLORIDA LAW

Date: Friday, November 1, 2013 | 9am – 5pm (Mr. Gassman speaks from 1:10 pm until 2:10 p.m.)

Location: Seton Hall Law School, Newark, New Jersey

Additional Information: Seton Hall University in South Orange, New Jersey was founded in 1856, and they have remodeled since.  Today, Seton Hall has over 10,000 students in its undergraduate, graduate and law school programs and is in close proximity to several Kentucky Fried Chicken locations.

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE)_SPECIAL 3 HOUR SESSION

Alan Gassman will be speaking on the topic of WHAT NEW JERSEY LAWYERS NEED TO KNOW ABOUT FLORIDA LAW – A 3 HOUR OVERVIEW BY ALAN S. GASSMAN

Date: Saturday, November 2, 2013

Location: Wilshire Grand Hotel, West Orange, New Jersey | 9am – 12pm

Additional Information: Please tell all of your friends, neighbors and enemies in New Jersey to come out to support this important presentation for the New Jersey Bar Association.  We will include discussions of airboats, how to get an alligator off of your driveway, how to peel a navel orange and what collard greens and grits are. For additional information please email agassman@gassmanpa.com

  • SALT LAKE CITY ESTATE PLANNING COUNCIL’S FALL ONE DAY “TAX AND DEDUCTIBILITY OF YOUR SKI TRIP” INSTITUTE

Alan Gassman will be speaking on the topic of PRACTICAL ESTATE PLANNING, WITH A $5.25 MILLION EXEMPTION AMOUNT

Date: Thursday, November 7, 2013

Location: Hilton Downtown Salt Lake City, Utah

Additional Information:  Please support this one day annual seminar conveniently located near skiing and tourism opportunities.  If you would like to attend this event or receive the materials please email agassman@gassmanpa.com

  • 1st ANNUAL ESTATE PLANNER’S DAY AT AVE MARIA SCHOOL OF LAW

Speakers: Speakers will include Professor Jerry Hesch, Jonathan Gopman, Alan Gassman and others.

Date: April 25, 2014

Location: Ave Maria School of Law, Naples, Florida

Sponsors: Ave Maria School of Law, Collier County Estate Planning Council and more to be announced.

Additional Information: For more information on this event please contact agassman@gassmanpa.com

NOTABLE SEMINARS PRESENTED BY OTHERS:

  • THIRD ANNUAL FEDERAL TAX INSTITUTE OF NEW ENGLAND

Date: September 27, 2013

Location: Hartford Marriot Farmington Hotel, Farmington, Connecticut

Sponsor: Connecticut Bar Institute

Additional Information: Chairman Frank Berall will be using part of an earlier Thursday Report article on same-sex planning in his presentation. You can also catch an early dose of Jerry Hesch’s talk on Income Tax Ideas for Estate Planning here before the Notre Dame Tax Institute in October, and Bruce Stone will be speaking on Assisted Reproductive Technology Children.  For more information or to register please visit the Institute’s site here.

  • 48TH ANNUAL HECKERLING INSTITUTE ON ESTATE PLANNING SEMINAR

Date: January 13 – 17, 2014

Location:  Orlando World Center Marriott, Orlando, Florida

Sponsor: University of Miami School of Law

Additional Information: For more information please visit: http://www.law.miami.edu/heckerling/

  • 16th ANNUAL ALL CHILDREN’S HOSPITAL ESTATE, TAX, LEGAL & FINANCIAL PLANNING SEMINAR

Date: Wednesday, February 12, 2014

Location: All Children’s Hospital Education and Conference Center, St. Petersburg, Florida with remote location live interactive viewings in Tampa, Sarasota, New Port Richey, Lakeland, and Bangkok, Thailand

Sponsor: All Children’s Hospital

  • THE UNIVERSITY OF FLORIDA TAX INSTITUTE

Date: February 19 – 21, 2014

Location: Grand Hyatt, Tampa, Florida

Sponsor:  UF Law alumni and UF Graduate Tax Program

Additional Information:  Here is what UF is saying about the program on its website: “The UF Tax Institute will provide tax practitioners and other leading tax, business and estate planning professionals with a program that covers the most current issues and planning ideas with a practical, informative, state-of-the-art approach.  The Institute’s schedule will devote separate days or half days to individual income tax issues, entity tax issues and estate planning issues.  Speakers and presentations will be announced as the program date nears to ensure coverage of the most timely and significant topics.  UF Law alumni have formed the Florida Tax Education Foundation, Inc., a nonprofit corporation, to organize the conference.”

For details about each event, please visit us online at gassmanlawassociates.com/newsandevents.html

Thank you to our law clerks that assisted us in preparing this report.

The Thursday Report – 8.1.13 – Ringo, New Land Trust Law & LLC Clinic

Posted on: August 1st, 2013

No Comments

No No Song

By Ringo Thur

 A tax lawyer I know just came from Nashville Tennessee-o.

I smiled because he did not understand.

Then I held up a recent Thursday Report

And he said I was the smartest of the land

And I said no, no, no, no,

I don’t read updates no more (or fill in your favorite vise)

I’m tired of waking up on the floor

No, thank you, please, I’d rather have a disease than

Give up my Thursday Report, au revoir.

Ringo Young and Old

Land Trusts – Use, Abuse, and Confusion by Alan S. Gassman

Ken Crotty’s LLC Clinic – More Information Regarding the Duty to Update Inaccurate Information in the Articles of Organization of a Florida LLC

1st Annual Estate Planner’s Day at Ave Maria School of Law

Additional Filing Requirements for Disregarded LLCs, Part 3

Our Recently Updated Article from Leimberg Information Systems – The Windsor Effect – Why Many Affluent Same-Sex Couples Will Be Leaving Florida and Where They Should Go

Enhance your professional practice, and enjoyment thereof – an afternoon with Srikumar Rao, Ph.D.

Research on Google

We welcome contributions for future Thursday Report topics. If you are interested in making a contribution as a guest writer, please email Janine Gunyan at Janine@gassmanpa.com.

 This report and other Thursday Reports can be found on our website at www.gassmanlawassociates.com.

Land Trusts – Use, Abuse, and Confusion by Alan S. Gassman

Many of us use land trusts for a number of purposes.  In the purist form, a land trust is simply an ownership titling device, under which an individual or entity can be the full and controlling beneficial owner of real estate or other property that is titled in the name of a trustee that will act only as and when specifically instructed.

This can facilitate confidentiality in the public records, the ability to transfer beneficial ownership without a subsequent deed (by transferring beneficial ownership of the land trust itself), and avoidance of probate and guardianship if the land trust has provisions that specifically require the trustee to transfer legal title to a successor entity or beneficiary.  Oftentimes an out-of-state LLC can be formed in a jurisdiction that does not disclose ownership or officers to be the trustee of the land trust.

Most states do not recognize or have laws that will facilitate the many uses of land trusts that can be implemented in Florida, Illinois and the other states that have land trust judicial or statutory recognition.

Many layman, and some misled or confused professionals, believe that an individual or entity can place real estate under a land trust, and then transfer beneficial land trust ownership interests and avoid documentary stamp taxes and transfer reporting requirements.  This is simply not the case.  Florida land trusts can be very useful for avoiding the necessity of transferring deeds, and maintaining confidentiality of ultimate ownership, but for tax and transaction reporting purposes clients should be advised that the transfer of beneficial ownership of a land trust will have the same documentary stamp tax, corporate income tax, and other results as a transfer of the underlying real estate interests would have.

Quite often we will establish a land trust and have the Trustee be an LLC formed and maintained in a state that does not require publication of Member or Manager information.  Then the public records will reflect ownership by the foreign LLC, and the beneficial ownership of the property does not need to be revealed on the public records, and cannot be easily discovered.  This may include homestead, and is a technique commonly used for professional athletes, celebrities, and those who wish to not have the general public be able to easily see where they live on the website of the local County Property Appraiser.

Notwithstanding the above, homestead real estate owned by a land trust may not qualify for the Florida homestead exemption unless the land trust contains special language, at least according to one Property Appraiser in house lawyer.  The language that we often use to help us confirm that homestead property held under a trust will qualify for the homestead exemption is as follows:

Notwithstanding the paragraph above, as to any real estate owned under this Trust which is held in a county in Florida where my spouse resides, and any replacement real estate thereto so designated by the Trustee, my spouse shall have all rights of occupancy, use, and possession of such real estate as would apply to the owner of a life estate, as Homestead real estate, and thus shall have all equitable rights to use of such real estate consistent with Section 6, Article VII, of the Florida Constitution and Florida Statute 196.041(2), and as required by any applicable County Property Appraiser to qualify for homestead tax exemption and applicable increase caps and portability unless said spouse elects to the contrary by a written instrument executed.

The statute can be reviewed by clicking here.

Excerpts from this analysis are set forth below, and the comparison showing what we deleted can be reviewed by clicking here:

EXCERPTS FROM SUMMARY ANALYSIS

CS/CS/HB 229 passed the House on April 24, 2013, and subsequently passed the Senate on April 26, 2013.The bill codifies certain provisions already in use by practitioners regarding land trusts, and distinguishes a land trust by the limited nature of the powers of the land trustee.

A land trust is a form of ownership of real property in which a trustee holds legal title to the land and a beneficiary retains the power of direction over the trustee and thus retains the power to direct the trustee to sell or mortgage the real property. A land trust is primarily defined by language in the deed to the trustee which allows third parties to rely upon the ability of the trustee to transfer the property without inquiry into the consent of the beneficiaries. Because of its singular nature, there are laws applicable to other trusts which have no usefulness in the area of land trust law. Further, the standard of practice in this area has not been codified, but rather has been pursued by reference to legal treatises and Illinois law, under which the original land trusts were established. This bill:

  • Better defines the difference between a land trust and a general trust, defining a land trust by the largely ministerial duties of the trustee.
  • Codifies in the Florida Land Trust Act a number of land trust practices commonly used in Florida and Illinois and derived from judicial precedents or land trust treatises.
  • Includes improvements based on the experience of Florida land trust practitioners that are intended to facilitate and encourage the use of land trusts in Florida real property transactions.

This bill does not appear to have a fiscal impact on state or local governments.

Subject to the Governor’s veto powers, the bill is effective upon becoming law

I. SUBSTANTIVE INFORMATION

A. EFFECT OF CHANGES:

Background

Florida law recognizes a number of types of trusts. In most instances a trustee is obligated to use a high standard of care in investing and handling assets. There is a duty to account to the beneficiary and the assets of a trust might change. In contrast, the trustee of a land trust has legal title to a single asset for purposes of marketability, makes almost no discretionary decisions, and takes direction from the beneficiary regarding that asset. Thus, there is a distinct body of law that applies to land trusts already established, which this bill seeks to codify and standardize in Florida.

Land trusts were developed first in Illinois, which remains the model for the standard arrangement in order to create a vehicle for simple transfer of title to property owned by a number of people. As opposed to other types of trusts in Florida, the land trustee is a place-holder for ease of transfer and marketability of title. The trustee of a land trust takes direction from the beneficiaries, and therefore has few if any fiduciary duties, nor any duties to account to the beneficiaries beyond sales transactions. This distinction is significant since Florida also has enacted the Florida Trust Code,[1] which imposes significant duties upon other types of trustees. These duties have no real relevance to the duties of the land trust trustee described in the Florida Land Trust Act.[2]

Section 689.071, F.S., was enacted in 1963 as the Florida Land Trust Act to validate the use of Illinois land trusts in Florida and to confirm the marketability of real property titles derived through a land trustee. Accordingly, this statute has always focused primarily on the authority of the land trustee to convey good title to third parties if the prior deed to the land trustee granted to the trustee certainpowers to deal with and dispose of the property, commonly referred to as “deed powers.”[3] Acting primarily as a “title estoppel”[4] statute, s. 689.071, F.S., protects third party grantees, mortgagees and lessees who rely on the statutory authority of the trustee based on those recorded deed powers without requiring them to inquire into the identity of the beneficiaries or the terms of the unrecorded trust agreement.

Effect of the Bill

A. General Overview

This bill clarifies the distinction between a land trust governed by s. 689.071, F.S., and other express trusts governed by the Florida Trust Code,[5] yet preserves the title estoppel benefits of the existing statute for any conveyance to a trustee where the conveying instrument contains deed powers. To

accomplish this objective, this bill:

  • Defines land trusts based on the functional scope of the land trustee’s duties, although deed

powers would remain an essential element of a Florida land trust; and

Relocates all the title estoppel provisions of s. 689.071, F.S., to a newly created section[6] which

remains equally applicable to any conveyance to a trustee containing deed powers.[7]

A transitional provision makes the new functional land trust definition apply only to trusts created on or after the effective date of the bill, and a trust existing before the effective date is classified as a land trust based on the intentions of the parties as expressed in or discerned from the existing trust agreement.

The relocated title estoppel provisions in the new section apply to any real property conveyed to a trustee at any time by an instrument containing deed powers, regardless of whether the trust is a land trust or not. By separating the title estoppel statute from the land trust statute in this way, this bill does not change the results intended by the parties to any trust agreement existing on the date that the bill becomes effective.

In addition to transferring the title estoppel provisions to a new section,[8] the bill also codifies in amended s. 689.071, F.S., a number of land trust practices and principles commonly used in Florida and Illinois and derived from judicial precedents or land trust treatises.

B. Point-by-Point Analysis

1. Title Estoppel Provisions – Creation of s. 689.073, F.S.

The marketability of title, and sometimes the anonymity of the beneficial owner, are the primary reasons for a land trust. Anyone who deals with the trustee must be assured that the trustee has legal ownership and full authority to deal with the property, and must also be assured that any claims between the land trustee and the beneficiaries will not affect the transaction or the grantee.

Currently these assurance provisions, called “title estoppel” provisions are set out in ss. 689.071(3), (4), and (5), F.S. The bill relocates the title estoppel provisions to a new section entitled, “Powers conferred on trustee in recorded instrument,”[9] and creates a new subsection, s. 689.073, F.S. In moving the provisions to the new statute,[10] changes were made to:

  • Remove language regarding the vesting of both “legal and equitable title” in the trustee;
  • Remove the reference to real property “in this state;”[11]
  • Relocate to s. 689.073(5), F.S., certain existing criteria for applicability; and
  • Simplify the remaining language.

The bill continues to vest in a trustee full power and authority to deal with the property as provided in the deed powers granted in the deed. The exclusion for instruments governed by s. 689.07, F.S. [existing s. 689.071(12), F.S.], is relocated to s. 689.073(4), F.S., changing only the words “this act” to “this section.”

Currently, the title estoppel provisions are operative whether the conveyance deed refers to the beneficiaries or any unrecorded trust agreement.[12] The bill creates s. 689.073(5), F.S., which:

  • Carries forward the provision that conveyance by the trustee is free of claims of beneficiaries;
  • Expressly provides that the title estoppel provisions work regardless of the provisions of any unrecorded trust agreement and regardless of whether the trust is a land trust or an express trust; and
  • Clarifies that the title estoppel section applies both to deeds recorded after the effective date of the proposed amendments and to deeds recorded under the present statute.[13]

This provision confirms that the relocation of the title estoppel section is not intended to change the legal effect of any previous conveyances under the present statute, and for good measure all such previous conveyances are validated as vesting the trustee with the requisite deed powers.

2. Definition of “Land Trust” – Revisions to s. 689.071(2), F.S.

The bill revises the remaining provisions of s. 689.071, F.S., which were not moved to the new section.[14] The revised definition of “land trust”[15] still requires a conveyance to a trustee by a recorded instrument containing deed powers, but beginning with the effective date of the bill this definition focuses on the key functional distinction between a land trust and other express trusts: that a land trustee functions almost entirely as the agent of the beneficiaries or the person holding the power of direction under the trust agreement, whereas a trustee who is subject to the Florida Trust Code in ch. 736, F.S., has more extensive fiduciary duties and responsibilities to the trust beneficiaries, along with more extensive potential liability if the trustee fails to perform the trustee’s discretionary duties prudently.

A land trustee has a fiduciary relationship to the land trust beneficiaries and the persons holding the “power of direction” over the actions of the land trustee, just as any agent is bound as a fiduciary to the principal for whom the agent acts.[16] However, in practice, land trustees are rarely delegated duties under a land trust agreement beyond ministerial and administrative matters.[17] This lack of duties is a logical parallel to the exemption that land trustees enjoy from ch. 736, F.S., responsibilities and liabilities. The bill makes clear this practical distinction in the revised definition of a land trust[18] by stating that the trustee has limited duties as set out in the statute.

For trusts created on or after the effective date of the bill, the revised definition will limit the duties of a trustee of a “land trust” to the following:

  • The duty to exercise the trustee’s deed powers as directed by the beneficiary or by the holder of the power of direction (i.e., this is the agent’s fiduciary duty: to follow the principal’s directions);
  • The duty to dispose of the trust property at the termination of the trust (i.e., the classic “active” duty that historically saved Illinois land trusts from the statute of uses);
  • The duty to perform ministerial and administrative functions delegated to the trustee; and
  • The duties required of certain timeshare trustees by ch. 721, F.S.[19]

If the trustee’s duties exceed the foregoing limited duties and the trust is created after the effective date of the proposed amendment, then the trust will not be treated as a land trust and will not be excluded from the operation of ch. 736, F.S.[20]

Because the title estoppel provisions of the statute operate on any conveyance containing deed powers, the classification of the trust as a “land trust” will have no effect on the title to any real property held by the trustee.

3. Other Definitions – Revisions to s. 689.071(2), F.S.

Besides revising the definition of “land trust,” section 2 of the bill adds and clarifies some other

definitions of lesser significance in s. 689.071(2), F.S:

  • The definition for “holder of the power of direction” is revised and shortened to “power of direction” because “holder of” is not used consistently in the statute;
  • The phrase “person or entity” is shortened to “person” in numerous places (beginning with the definition of “trustee”) because the statutory definition of “person” includes entities;
  • New definitions are created for some basic trust concepts, such as “trust agreement,” “trust property” and “recorded instrument” (the latter being a cross-reference to the relocated deed powers provision now found in s. 689.073(1), F.S.); and
  • “Trustee” is redefined so that the term will work in the “switchbox”[21] provision to mean the trustee of a land trust or the trustee of another trust. For this reason, numerous references to “trustee” in revised s. 689.071, F.S., will be changed to “trustee of a land trust” where that meaning is intended.

4. Vesting of “Legal and Equitable Title” Revisions to s. 689.071(3), F.S.

The bill continues the existing statutory statement that a land trustee is vested with both legal and equitable title to the trust property. This vesting of “legal and equitable title” provision is a land trust characteristic imported from Illinois, and therefore it does not appear in the relocated title estoppel provisions in s. 689.073, F.S., that universally apply to any type of trust with deed powers. Although the “legal and equitable” language has been excised from a number of other subsections of s. 689.071, F.S., to avoid potential circularity, s. 689.071(3), F.S., will continue to contain the operative language regarding vesting of legal and equitable title in the land trustee.

5. Statute of Uses and Doctrine of Merger – Revisions to ss. 689.071(4) and (5), F.S.

New section 689.071(5), F.S., overrides the doctrine of merger with respect to a land trust, so that a land trust will not be extinguished if the trustee is the sole beneficiary. Former s. 689.071(5), F.S., is one of the title estoppel provisions relocated verbatim to s. 689.073, F.S.

6. Personal Property Option– Revisions to s. 689.071(6), F.S.

Currently, section 689.071, F.S., provides that the recorded instrument may define and declare the interests of land trust beneficiaries as personal property under Florida law.[22] The bill provides that this designation of personal property must be made in the recorded instrument or the trust agreement, or it will be considered real property.

Section 689.071(6), F.S., is changed in one regard: the optional personal property declaration may be made in the recorded instrument or in the trust agreement. This change is consistent with the relocation of the title estoppel provisions to new s. 689.073, F.S., which governs title matters that depend on the contents of the recorded instrument. Whether the beneficial interests are real property or personal property does not affect the nature of the title vested in the trustee or the ability of third parties to acquire good title to the trust property from the trustee in accordance with the powers contained in the recorded instrument.

7. Beneficiary Provisions– Revisions to s. 689.071(8), F.S.

Currently, customary provisions in land trusts are based upon treatises by Illinois land trust authorities, particularly Kenoe on Land Trusts.[23] The bill revises s. 689.071(8), F.S., in a number of respects to codify these land trust practices.

The purpose of including these provisions directly in the Land Trust Act is to increase practitioner awareness that such techniques are available without making reference to the treatise, thereby promoting the usage of land trusts in Florida generally.

The bill revises s. 689.071(8)(c), F.S., to reconcile the Land Trust Act with the Uniform Commercial Code (U.C.C.) Article 9 exclusion of interests in real property.[24] Case law[25] holds that a beneficial interest in a land trust is a general intangible within the scope of the Florida Uniform Commercial Code, and this result is codified in the present version of s. 689.071(8)(c), F.S., which provides that U.C.C. Article 9 governs the perfection of a security interest in a beneficial interest in a land trust. However, if the beneficial interest is defined as real property under s. 689.071(6), F.S., then there is a possible contradiction between the Land Trust Act (which says Article 9 applies to beneficial interests) and the U.C.C. (which says Article 9 excludes real property interests).

The bill revises s. 689.071(8)(c), F.S., to resolve this apparent contradiction by clarifying that the U.C.C. governs perfection if the beneficial interest in a land trust is declared to be personal property (as was the case in Cowsert), but that a mortgage instrument recorded in the real estate records is the proper method of perfection if the beneficial interest in a land trust is declared to be real property. In the latter case, the proper county for recording the mortgage may be specified in the recorded instrument or in a declaration of trust or memorandum that is recorded in the same county as the recorded instrument; otherwise the location of the trust property determines the proper county for recording the mortgage. The bill provides a transition rule[26] to provide for the continuation of perfection for any U.C.C. financing statement that may have been filed before the effective date of this clarification. It is an abbreviated version of the transition rules that were included in Revised U.C.C. Article 9 in 2001.

The bill revises the existing last sentence of s. 689.071(8)(c), F.S., to state more clearly that a lien or security interest perfected against a beneficial interest in a land trust does not affect in any way the legal or equitable title of the land trustee to the trust property. New s. 689.071(8)(d), F.S., makes explicit a concept that is inherent in a beneficiary’s ability to encumber a beneficial interest as described in existing s. 689.071(8)(c), F.S: the trustee’s legal and equitable title to the trust property is separate and distinct from the beneficiary’s beneficial interest in the land trust and the trust property. A lien, judgment, mortgage, security interest or other encumbrance against one interest does not automatically attach to the other interest. Section 689.071(8)(e), F.S., is also revised to clarify this same point: documents recorded by a beneficiary to transfer or encumber a beneficial interest do not affect the legal and equitable title of the trustee or the deed powers granted to the trustee in the recorded

instrument.

Sections 689.071(8)(f) and (g), F.S., as well as other parts of s. 689.071(8), F.S., have been edited for consistent usage of the defined terms “land trust,” “recorded instrument,” “trust agreement,” and “trust property.”

The bill adds s. 689.071(8)(i), F.S., which is intended to end the reported occasional practice by some judges of appointing a guardian ad litem to represent the interests of land trust beneficiaries in a foreclosure or other litigation affecting title to the trust property. Because a land trustee is vested with both legal and equitable title to the trust property, joinder of the land trustee in the action is sufficient without incurring the additional expense of a guardian ad litem.

8. Successor Trustee Provisions– Revisions to s. 689.071(9), F.S.

Most of the revisions to s. 689.071(9), F.S., are non-substantive edits for consistent usage of defined terms and modernization of language (e.g., replacing “office of the recorder of deeds” with “public records”). The bill deletes s. 689.071(9)(a), F.S., because the “switchbox” provision in subsection 689.071(12), F.S., globally addresses the inapplicability of chapter 736, F.S., to land trusts.

The current text of s. 689.071(9), F.S., uses the expression “each successor trustee” to avoid the longer phrase “the successor trustee or trustees.” Unfortunately, it is possible to misread the shorter phrase to mean “each and every successor trustee” in a series of successors.[27] The longer expression is clearer and replaces the shorter one.

Currently, s. 689.071(9)(f), F.S., provides that the beneficiaries may direct the land trustee to convey the trust property to another trustee. The bill changes this paragraph to provide that this direction to convey could also come from the person holding the power of direction.

9. Trustee as Creditor– Revisions to s. 689.071(10), F.S.

The bill revises s. 689.071(10)(a), F.S., to include a conforming reference to a mortgage (as well as a security interest) against a beneficial interest in a land trust. Other non-substantive edits include consistent usage of defined terms and the deletion of “or entity” after “person.”

10. Notices to Trustee Provisions– Revisions to s. 689.071(11), F.S.

The bill adds a new subsection to assure that the right parties receive any third-party notices concerning property held in a land trust by requiring that notice to a land trustee include certain identifying information if it appears in the recorded instrument.

11. Florida Trust Code – Scope Provision– Revisions to s. 736.0102, F.S.

The bill includes a conforming amendment to s. 736.0102, F.S., of the Florida Trust Code. The bill divides this section into two logical subsections, and a third subsection is added to address the exclusion of land trusts from the Florida Trust Code. New s. 736.0102(3), F.S., provides that the Trust Code does not apply to land trusts under s. 689.071, F.S., except to the extent provided in subsection 689.071(7), F.S., of the Land Trust Act and in the two provisions of ch. 721, F.S., that apply parts of ch. 736, F.S., to timeshare trusts.

The bill adds s. 736.0102(3), F.S., to provide that a Trust Code trust remains a Trust Code trust (and does not become a land trust) regardless of any amendment or change in asset composition or utilization of a sub trust.


[1] Chapter 736, F.S.

[2] Section 689.071, et seq., F.S.

[3] See s. 679.071(3), F.S.

[4] “Title estoppel” is the representation to a bona fide purchaser by a land trustee that he or she is fully able to transfer the legal title to the subject property, that the transferee is protected from title assaults by the beneficiaries of the trust, that the beneficiaries need not be disclosed, that the trust document need not be disclosed, and other assurances that the purchaser and others may safely deal with the trustee.

[5] Chapter 736, F.S.

[6] Section 689.073, F.S., is created.

[7] “Deed powers,” as used in this analysis refer to the language of s. 689.071(3), F.S, which is, “to protect, to conserve, to sell, to lease, to encumber, or otherwise to manage and dispose of the real property described in the recorded instrument.”

[8] Section 689.073, F.S.

[9] Section 1 of the bill relocates and slightly revises ss. 689.071(3), (4) and (5), F.S., moving them to a new s. 689.073, F.S. Subsections (4) and (5) are relocated as-is and renumbered s. 689.073(2) and (3), F.S.

[10] As revised, s. 689.071(3), F.S., becomes s. 689.073(1), F.S.

[11] This provision confirms that out-of-state lands may be held in Florida land trust regimes.

[12] Section 689.071(3), F.S.

[13] Id.

[14] Section 689.073, F.S

[15] Section 689.071(2)(c), F.S

[16] Raborn v. Menotte, 974 So.2d 328 (Fla. 2008).

[17] “The trustee is a mere vessel of title.” Brigham v. Brigham, 11 So.3d 374 (Fla. 3d DCA 2009).

[18] Section 689.071(2)(c), F.S.

[19] Section 721.08, F.S., provides that time share accommodations may be placed into a trust. This will be addressed in detail below, in regard to the effect of this statute.

[20] Chapter 736, F.S., is the Florida Trust Code and applies to express trusts.

[21] This transition rule exempts existing land trusts from the new duties-based test in s. 689.071(2)(c), F.S; rather, an existing trust is a land trust (or not) based on the intentions expressed in (or discernible from) the existing trust agreement. This is explained in more detail on page 8 of this analysis.

[22] Except of course for the stamp tax provision in s. 201.02(4), F.S

[23] The author, Henry W. Kenoe, wrote a number of treatises on land trusts which are now out of print.

[24] These provisions are found in s. 679.1091(4)(k), F.S.

[25] In re Cowsert, 14 B.R. 335 (Bankr.S.D.Fla. 1981).

[26] See the newly created s. 689.071(13), F.S.

[27] E.g., existing paragraph s. 689.071(9)(c), F.S., requires that “each successor trustee shall file a declaration of appointment.”

Ken Crotty’s LLC Clinic – More Information Regarding the Duty to Update Inaccurate Information in the Articles of Organization of a Florida LLC

Liability of Members and Managers for Inaccurately Filed Information

As mentioned in the July 25, 2013 issue of the Thursday Report, one of the changes made by Florida’s new LLC Act is that members (in a member-managed LLC) and managers (in a manager-managed LLC) are responsible for maintaining accurate information filed with the Department of State.  This information includes anything stated in the Articles of Organization and other records of the LLC that are filed with the Department.

In most situations it would seem that having inaccurate information on the Secretary of State website will not cause liability, but in some situations third parties might claim that they relied upon the Secretary of State website to determine the identity of individuals with authority to act on behalf of the LLC, and if they are swindled or misled by those individuals, they might have a cause of action not only against the LLC, but also against the manager or member who was responsible for making sure that the Secretary of State website had the correct information.

If any of the information stated on these filings becomes inaccurate at any point, it is the duty of managing members and/or managers, as applicable, to correct such information.  If the information filed is inaccurate and a third party relies on this inaccurate information, then the managing members and/or managers, as applicable, who had the duty to update such information could be exposed to liability to the third party.

Liability for some of the members of a member-managed LLC may be minimized by having the operating agreement of the LLC specifically state which members are responsible for maintaining accurate records with the Secretary of State.  Non-voting or non-managing members in a member-managed LLC may want to have such a provision included in the LLC’s operating agreement.

Members and/or managers responsible for maintaining accurate records of existing LLCs should be certain that the filed information for the LLC is correct by January 1, 2014.   These members and/or managers should also calendar future dates to periodically check and make sure the records have the most current information.  If any information is found to be inaccurate, corrected documents should be filed as quickly as possible.

It is important to note that duty to keep information correct and the potential liability related to incorrect information applies to both Florida and non-Florida LLCs.

1st Annual Estate Planner’s Day at Ave Maria School of Law

            Ave Maria School of Law located in Naples, Florida will be holding the 1st Annual Estate Planner’s Day on April 25, 2014.  This is the first annual event which will feature topics relevant to attorneys, accountants, bankers, trust officers, financial advisors and life insurance advisors.  Dean Ted Afield, Donna Heiser, Jonathan Gopman, Lester Law, Chris Bray, Greg Holtz and others are helping to make this 1st annual event a success.

Speakers include Professor Jerry Hesch, Jonathan Gopman, Alan Gassman and others.  The event is sponsored by Ave Maria School of Law and the Collier County Estate Planning Council.

If you would like more information on the event, have a suggested topic or would like to be a speaker at the event, please email Jonathan Gopman at jonathan.gopman@akerman.com.

Many Florida lawyers and other professionals are not familiar with Ave Maria School of Law or the other Florida law schools.   Ave Maria School of Law received ABA accreditation in 2005 and was originally located in Ann Arbor, Michigan, prior to the school being relocated to Florida in 2009. Ave Maria is described as a national law school that emphasizes the moral foundations of the law, presents insights from the Catholic intellectual tradition, and encourages a broader perspective of the law and its role in society. The Catholic institution boasts a diverse student body of approximately 500 students that represent almost every state and several other nations. With a curriculum designed to prepare students for the practice of law in any jurisdiction and employment area, Ave Maria School of Law has placed graduates in prestigious judicial clerkships, in firms of all sizes throughout the country, in positions with federal and state agencies, and in jobs with both domestic and international public-interest employers.

A chart of law schools and some information associated therewith is as follows:

In 1980, Florida had only five law schools, University of Florida, Florida State University, Stetson Law School, University of Miami, and Nova Southeastern University.

We now have 12.

Can you name them?

A Florida law school chart is as follows:

Law School

Year ABA Approved

Number of Students

Median GPA of Admissions Class

Median  LSAT of Admissions Class

Location

Tuition

Ava Maria

School of Law

2002

391

3.10

148

Naples

$37,270

Barry University Dwayne O. Andreas  School of Law

(FT & PT Programs)

2002

753

2.92

147

Orlando

$34,300 FT$25,900 PT

524 FT

2.92 FT

147 FT

229 PT

2.96 PT

147 PT

Florida A&M University

College of Law

(FT & PT Programs)

2004

655

3.09

146

Orlando

Resident:$13,675 FT

$10,028 PT

Non-Resident:

$32,936 FT

$24,153 PT

473 FT

3.11 FT

146 FT

182 PT

2.97 PT

148 PT

Florida Coastal School of Law

(FT & PT Programs)

1999

1,594

3.10

146

Jacksonville

$39,370 FT$31,854 PT

1,371 FT

3.10 FT

146 FT

223 PT

2.96 PT

145 PT

University of Florida Fredric G. Levin College of Law

1925

960

3.59

161

Gainesville

Resident:$21,421Non-Resident:$40,786

Florida International University

College of Law

(FT & PT Programs)

2004

508

3.60

156

Miami

Resident:$18,841 FT

$12, 886 PT

Non-Resident:

$33,086 FT

$22,535 PT

346 FT

3.58 FT

156 FT

162 PT

3.61 PT

151 PT

Florida State University

College of Law

1968

698

3.54

160

Tallahassee

Resident:$19,731Non-Resident:$39,744

University of Miami School of Law

1941

1,307

3.36

156

Miami

$42,938

Nova Southeastern University

Shepard Broad Law Center

(FT & PT Programs)

1975

1,029

3.14

150

Fort Lauderdale

$39,370 FT$31,854 PT

829 FT

3.15 FT

150 FT

200 PT

3.06 PT

148 PT

St. Thomas University

School of Law

1988

678

3.01

148

Miami Gardens

$ 36,226

Stetson University College of Law

(FT & PT Programs)

1930

1,004

3.28

155

Gulfport/

Tampa

$36,168 FT$25,068 PT

778 FT

3.31 FT

155 FT

226 PT

3.11 PT

153 PT

Thomas M. Cooley Law School

Has not received full ABA approval in FL yet.  Classes began in late 2012, but the school is not listed as a Florida law school on the LSAC website. Riverview

All of the above information is from the LSAC Official Guide.  The Wikipedia page on each of these law schools can be accessed by clicking here.

For Juris Doctors looking to become experts in a particular area of law, Florida law schools offer a number of Master of Law programs:

University of Miami:

LLM in International Law

LLM in Ocean and Coastal Law

LLM in Taxation

LLM in Real Property and Development

LLM in Estate Planning

LLM in Taxation of Cross-Border Investment

University of Florida:

LLM in Comparative Law

LLM in Taxation

LLM in International Taxation

LLM in Environmental and Land Use Law

Doctor of Juridical Science (S.J.D.) in Taxation

Florida Coastal School of Law

LLM in US Law (distance learning, for international lawyers)

Additional Filing Requirements for Disregarded LLCs, Part 3

Reporting Agents for Disregarded Entities and filing Form 8655

If an LLC is a single member LLC, the entity’s classification will determine who may sign a Form 8655.  If the entity is classified as disregarded, then the Form 8655 must be signed by the owner or by an authorized representative who can demonstrate the authority to sign the form.

A filed Form 8655 is required for a reporting agent to have authorization.  Such authorization may also be submitted on a substitute form approved by the IRS (see IRS Pub No. 1167).

The Form 8865 authorizes the reporting agent to (1) sign and file certain returns on behalf of the individual or entity; (2) make deposits and payments for certain returns; (3) receive duplicate copies of tax information, notices, and other communication regarding the individual or entity; and (4) provide the IRS with information related to penalty relief determinations for any authority granted under the Form 8655.

A Form 8655 for a corporation, including an LLC treated as a corporation, may be signed by (a) any officer with authority to bind the corporation, (b) any person designated by the governing body of the corporation, (c) any officer or employee granted written authority to sign by a principal officer, and (d) any other authorized person.

For a partnership, including an LLC treated as a partnership, the Form 8655 may be signed by any person who was a member of the partnership during any part of the tax period described in the Form 8655.

For a trust or estate, the Form 8655 must be signed by the fiduciary.

Form 8858 Filing for Foreign Disregarded Single Member LLCs

Form 8858 is the information return of a U.S. person which reports activity related to foreign disregarded entities (“FDEs”).  The accompanying Schedule M reports transactions between foreign disregarded entities of a foreign tax owner and the filer or other related entities.  This form must be filed by U.S. person that is considered to be the tax owner of FDEs, or that owns certain interests in foreign tax owners of FDEs.  Form 8858 is due with the U.S. persons income tax or informational returns, and must be filed each year.

Form 8858 has three categories of “U.S. Persons” who are required to file.

Category 1.  U.S. persons who are treated as the tax owner of a foreign disregarded entity at any point during the taxable year.   A disregarded entity is not considered a U.S. person.  So if a domestic or foreign parent disregarded entity owns a subsidiary FDEs, then the owner of the parent disregarded entity has the obligation to report the foreign disregarded entity.

Category 2.  U.S. persons who must file Form 5471 may be required to file Form 8858 if the controlled foreign corporation owns a FDE.  Form 5471 deals with controlled foreign corporations and has various categories of filers.  Only those persons who are considered to be Category 4 and Category 5 filers for Form 5471 are required to file a Form 8858.  These are U.S. persons who controlled the controlled foreign corporation for at least 30 consecutive days during the taxable year, and/or a shareholders of a controlled foreign corporation who owned at least 10% of the voting stock of the controlled foreign corporation for at least 30 consecutive days.  U.S. persons who are neither Category 4 nor Category 5 filers of Form 5471 do not have to file Form 8858.

Category 3.  U.S. persons who must file Form 8865 may also be required to file Form 8858.  Form 8865 is filed to report information related to controlled foreign partnerships which are treated as the tax owners of FDEs during the taxable year.  If a U.S. person controls 50% of the foreign partnership then that U.S. person needs to file the Form 8858.  If no U.S. person controls 50% of the partnership then U.S. persons owning 10% or more of the foreign partnership must file Form 8858.

Our Recently Updated Article from Leimberg Information Systems – The Windsor Effect – Why Many Affluent Same-Sex Couples Will Be Leaving Florida and Where They Should Go

Our July 11, 2013 Thursday Report entitled “Why Many Same-Sex Couples Will Be Looking to Leave Florida and Where They May Go” was updated to disclose recent state court litigation and was published last night on the Leimberg System.

You can read Steve Leimberg’s version of the article by clicking here.

What we added from the July 11, 2013 version is as follows:

Since the Windsor decision, a number of same-sex couples that were legally married in a state that recognizes same-sex marriage, but reside in states that do not, have filed lawsuits against state and local officials in order to have their marriage recognized for various state law purposes. Specifically, a couple in Ohio (which banned same-sex marriage in 2004) sued to have their marital status be reflected as “married” on their death certificates so that they can be buried next to each other in a cemetery that only allows spouses and descendants to be buried there.  One of the spouses is dying of Lou Gehrig’s diseases, and his family has a burial plot in the cemetery in question.

A federal judge ordered that the couple’s marriage should be recognized in Ohio because, despite Ohio’s ban on same-sex marriage, it has historically recognized out-of-state marriages that were legally valid where they took place.  Many states do not recognize same-sex marriage, but have laws which recognize marriages that are legally valid in other states, including marriages that involve cousins and minors.  This brings to the forefront the new issue of whether states can refuse to recognize same-sex marriages where the state has historically recognized marriages that are legally valid in other states.

Similar lawsuits have been initiated in Illinois, Kentucky, Nevada, New Jersey and Pennsylvania.  Time will tell how these cases are received by courts across the nation, and what effect this will have on the recognition of same-sex marriage across state lines.  Many states might wish to pass legislation which singles out same-sex marriages, and the resulting constitutional law implications could form the basis for dramatic social change in this country.

We have updated our same-sex couple state selection chart to take into account that Delaware repealed the previously planned sunset of its estate tax that would have otherwise occurred on July 1, 2013.  Click here to view the chart..

Enhance your professional practice, and enjoyment thereof – an afternoon with Srikumar Rao, Ph.D.

Dr. Rao 2

Many lawyers, accountants, and other professionals have taken a Srikumar Rao, Ph.D. course entitled Creativity and Personal Mastery, which was developed at Columbia University and later taught at Stanford University and the London School of Business, and for private and publicly traded companies.

We are co-sponsoring a Saturday afternoon workshop with Dr. Rao entitled Enhanced Effectiveness and Enjoyment of Your Professional and Personal Life – 5 Tools You Can Start Using Immediately in Clearwater on Saturday, October 12, 2013.

Dr. Srikumar Rao is a former business school professor, and head of The Rao Institute.  He created the singularly powerful course Creativity and Personal Mastery, which he has taught at leading business schools including Columbia and the London Business School.  Hundreds of executives have been transformed by CPM, including from such companies as Google, Microsoft, Merrill Lynch, General Electric, Morgan Stanley and others.  Dr. Rao has written two books, Are You Ready to Succeed? and Happiness at Work, and writes regularly on management practices and leadership.  He has received wide media  coverage and acclaim, and has been a speaker for TED and Leading @Google talks.  He received his PhD in Marketing from Columbia University, and has worked as an executive for Warner Communications, Continental Group, Data Resources and McGraw Hill.

“Over the past year I’ve attended several of Professor Rao’s lectures and courses, including his 3 month comprehensive course on Creativity and Personal Mastery.  The techniques I learned have made a tremendous difference in my life.  I am happier, more relaxed and handle stressful situations with greater ease.  I would recommend his program to anyone seeking a happier, more tranquil lifestyle.” Rose Dean, CPA

“Dr. Rao’s Saturday 5 hour workshop was an enjoyable experience. His program combines tools and exercises that are both practical and effective in day-to-day life and that are easily implemented. I recommend this program for people who want to enhance their happiness both in their personal and professional lives.” – Mahesh Amin, M.D.

“I attended Professor Rao’s Saturday, Saturday, August 18, 2012 workshop, and it was so good that I subsequently attended part 2 on Sunday September 23, 2012. As a business manager, husband and father I strongly recommend it for anyone who wants to be more effective, enjoy life more, and have better interactions with other. It was great to have someone of Professor Rao’s stature in Clearwater and to meet such a nice person.” Daniel Sweeney, Vice President, BayCare HomeCare

You can learn more about this event by click here.

Research on Google

            If you want to see a write-up of any topic that has been covered in our Thursday Reports just search “Thursday Report Gassman” and type in the topic and you will find that every Thursday Report covering that topic comes up.  Google directs you right to the page where that topic begins.  You can also search our website directly by using the search box on the top right hand side of the page.  This way you can search not only the Thursday Report but the other resources on our website.  You can view our website by clicking here.  Rumors that the Thursday Report has acquired Google are strenuously denied.

Applicable Federal Rates

Please click here to view a chart of this month’s, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale you can use the lowest of the 3.

Seminars and Webinars

  • PLANNING FOR SNOWBIRDS: Tips, Traps and Tactics for Advisors with Clients in Florida – An Encore Presentation          

Our first presentation on this topic was so well received by Bloomberg BNA Tax & Accounting that they have asked us back for a replay of the original presentation.  There will be a live question and answer session at the end of the replay. 

Date: Wednesday, August 7, 2013 | 12:30 p.m.

Presenters: Alan Gassman, Gary Teblum, Kenneth Crotty and Christopher Denicolo

Additional Information: The cost of this webinar is $348 for the webinar and the CD, $249 for just the webinar or $249 for just the CD.  For more information and to register for this webinar please click here.

  • FINANCIAL PLANNING ASSOCIATION (FPA) TAMPA BAY 2013 FLORIDA SYMPOSIUM

Alan Gassman will be joining Ken Zahn, CFP for a joint seminar on A Brief Introduction on the Art of Wealth Protection Planning. This seminar will also include a demonstration of our new EstateView Estate Planning Software.  Attendees will also receive a link to download the software to use on their own clients matters for a number of week.  For more information and to register for this webinar please click here.

Date: Monday, August 19, 2013 | Time to be determined

Speakers: Elizabeth Jetton, CFP, Linda Chamberlain, JD, CMC, Ken Zahn, CFP and Alan Gassman, JD, LL.M.

Location: Marriott Westshore Tampa, 1001 N. Westshore Blvd, Tampa, Florida

Additional Information: For more information and to register for this webinar please click here.

  • THE JOINT EXEMPT STEP-UP TRUST (JEST)

Many lawyers are using our Joint Exempt Step Up Trust to enable clients in non-community property states to receive a stepped-up basis on all “joint trust assets” on the death of the first dying spouse.  Our Leimberg article on the Joint Exempt Step-Up Trust can be viewed by clicking here and the accompanying chart can be viewed by clicking here.

The Ultimate Estate Planner, Inc. is also featuring our Joint Exempt Step Up Trust forms, client explanation letter and other materials on their website.  To order the forms you can click here.

Date: Wednesday, August 21, 2013 | 12pm Eastern/9am Pacific

Sponsor: The Ultimate Estate Planner, Inc.

Additional Information:  The cost of the teleseminar is $139 for the teleseminar only or $189 if you would like to receive both the teleseminar and the accompanying PowerPoint and downloadable PDF materials.  For more information and to register  please click here.

  • WHAT CLIENTS ARE AND ARE NOT SUITABLE FOR LONG TERM CARE INSURANCE

Date: Thursday, August 29, 2013 | 5:00 p.m.

Presneter: Rob Cochran

Location: Online webinar

Additional Information: To register for the webinar please click here.

  • AVOIDING THE TRAPS IN EMR/TECH CONTRACTS….NOW YOU TELL ME I’M STUCK WITH THIS FOR 5 YEARS!

Date: Tuesday, September 10, 2013 | 5:00 p.m and Thursday, September 12, 2013 | 12:30 p.m. (Each webinar will last 30 minutes)

Presenter: Sandra Greenblatt, Board Certified Health Lawyer

Location: Online webinar.

Additional Information: To register for the Tuesday, September 10, 2013, 5pm webinar please click here.  To register for the Thursday, September 12, 2013, 12:30 p.m. webinar please click here.

NIP & TUCK: MAKING THE CALL ON OFFICE-BASED SURGERY

Date: Wednesday, September 18, 2013

Presenter: Cheryl White, RN, BS, MSHL, LHRM, LNCC, MSCC, DFHRMPS and Lester Perling, J.D., MHA

Location: Online webinar

Additional Information:  To register for the webinar please click here.

NORTH SUNCOAST FICPA MONTHLY MEETING

Date: Wednesday, September 18, 2013, 4:30 – 6:30 p.m.

Speakers: Christopher Denicolo and Tom Davis will speak on the Affordable Care Act; Alan Gassman will be speaking on a topic to be determined.

Location: Chili’s in Port Richey

Additional Information: To attend this seminar please email agassman@gassmanpa.com

WEDU ESTATE PLANNING SEMINAR  

Gassman Law Associates meets Big Bird – Sesame Street vs. Wall Street?

Alan Gassman will be speaking on the topic of ASSET PROTECTION – ESSENTIAL KNOWLEDGE AND HOT TOPICS

Date: Thursday, September 19, 2013 | 7:30 am – 11:30 am

Location: TBD

Additional Information:  If you would like to sign up for this seminar please email agassman@gassmanpa.com

ENHANCED EFFECTIVENESS AND ENJOYMENT OF YOUR PROFESSIONAL AND PERSONAL LIFE – 5 TOOLS YOU CAN START USING IMMEDIATELY

Gassman Law Associates, P.A. is co-sponsoring a half-day workshop with noted author and speaker, Dr. Srikumar Rao

Date:    Saturday, October 12, 2013 | 1:00 – 6:00 p.m with option 7:00 – 8:00 question and answer session

Location: Holiday Inn Express, U.S. 19 and Gulf-to-Bay Blvd, Clearwater, FL

Additional Information: For more information please click here or email agassman@gassmanpa.com

NOTRE DAME TAX INSTITUTE

Jerry Hesch and Alan Gassman will be speaking on the topic of INTERESTING INTEREST QUESTIONS, PLANNING WITH LOW INTEREST LOANS, PRIVATE ANNUITIES, DEFECTIVE GRANTOR TRUSTS, AND PRIVATE AND COMMERCIAL ANNUITIES

Date: Wednesday, October 16 through Friday, October 18, 2013

Location: Notre Dame College, South Bend, Indiana

Additional Information: Professor Jerry Hesch’s Notre Dame Tax Institute will once again emphasize the importance of income tax planning and implications in addition to estate, estate tax, and related concepts.

We welcome questions, comments and suggestions for the presentation that we are assisting Jerry in preparing and presenting.

PINELLAS COUNTY ESTATE PLANNING COUNCIL HALF-DAY SEMINAR

Alan Gassman will be speaking on the topic of HOT TOPICS FOR ESTATE PLANNERS

Date: Wednesday, October 23, 2013 | 8:00 am – 12:00 p.m. (60 MINUTE PRESENTATION)

Location: TBD

Additional Information: To attend the meeting or to receive information on joining the Council please click here or email agassman@gassmanpa.com

  • 2013 MOTE VASCULAR SURGERY FELLOWS – FACTS OF LIFE TALK SEMINAR FOR FIRST YEAR SURGEONS

Alan Gassman will be speaking on the topic of ESTATE, MEDICAL PRACTICE, RETIREMENT, TAX, INSURANCE, AND BUY/SELL PLANNING – THE EARLIER YOU START THE SOONER YOU WILL BE SECURE

Date: October 25 – 27, 2013 | Times TBD

Location: TBD

Additional Information: Please contact agassman@gassmanpa.com for additional information.

NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE) HEALTH LAW SYMPOSIUM – AN ALL DAY SEMINAR

Alan Gassman will be speaking on the topic of WHAT HEALTH LAWYERS NEED TO KNOW ABOUT FLORIDA LAW

Date: Friday, November 1, 2013 | 9am – 5pm (Mr. Gassman speaks from 1:10 pm until 2:10 p.m.)

Location: Seton Hall Law School, Newark, New Jersey

Additional Information: Seton Hall University in South Orange, New Jersey was founded in 1856, and they have remodeled since.  Today, Seton Hall has over 10,000 students in its undergraduate, graduate and law school programs and is in close proximity to several Kentucky Fried Chicken locations.

NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE)_SPECIAL 3 HOUR SESSION

Alan Gassman will be speaking on the topic of WHAT NEW JERSEY LAWYERS NEED TO KNOW ABOUT FLORIDA LAW – A 3 HOUR OVERVIEW BY ALAN S. GASSMAN

Date: Saturday, November 2, 2013

Location: Wilshire Grand Hotel, West Orange, New Jersey | 9am – 12pm

Additional Information: Please tell all of your friends, neighbors and enemies in New Jersey to come out to support this important presentation for the New Jersey Bar Association.  We will include discussions of airboats, how to get an alligator off of your driveway, how to peel a navel orange and what collard greens and grits are. For additional information please email agassman@gassmanpa.com

SALT LAKE CITY ESTATE PLANNING COUNCIL’S FALL ONE DAY “TAX AND DEDUCTIBILITY OF YOUR SKI TRIP” INSTITUTE

Alan Gassman will be speaking on the topic of PRACTICAL ESTATE PLANNING, WITH A $5.25 MILLION EXEMPTION AMOUNT

Date: Thursday, November 7, 2013

Location: Hilton Downtown Salt Lake City, Utah

Additional Information:  Please support this one day annual seminar conveniently located near skiing and tourism opportunities.  If you would like to attend this event or receive the materials please email agassman@gassmanpa.com

1st ANNUAL ESTATE PLANNER’S DAY AT AVE MARIA SCHOOL OF LAW

Speakers:  Speakers will included Professor Jerry Hesch, Jonathan Gopman, Alan Gassman and others.

Date: April 25, 2014

Location: Ave Maria School of Law, Naples, Florida

Sponsors: Ave Maria School of Law, Collier County Estate Planning Council and more to be announced.

Additional Information: For more information on this event please contact agassman@gassmanpa.com.

NOTABLE SEMINARS PRESENTED BY OTHERS:

48th ANNUAL HECKERLING INSTITUTE ON ESTATE PLANNING SEMINAR     

Date: January 13 – 17, 2014

Location:  Orlando World Center Marriott, Orlando, Florida

Sponsor: University of Miami School of Law

Additional Information: For more information please click here.

16th ANNUAL ALL CHILDREN’S HOSPITAL ESTATE, TAX, LEGAL & FINANCIAL PLANNING SEMINAR

Date: Wednesday, February 12, 2014

Location: All Children’s Hospital Education and Conference Center, St. Petersburg, Florida with remote location live interactive viewings in Tampa, Sarasota, New Port Richey, Lakeland, and Bangkok, Thailand

Sponsor: All Children’s Hospital

THE UNIVERSITY OF FLORIDA TAX INSTITUTE

Date: February 19 – 21, 2014

Location: Grand Hyatt, Tampa, Florida

Sponsor:  UF Law alumni and UF Graduate Tax Program

Additional Information:  Here is what UF is saying about the program on its website: “The UF Tax Institute will provide tax practitioners and other leading tax, business and estate planning professionals with a program that covers the most current issues and planning ideas with a practical, informative, state-of-the-art approach.  The Institute’s schedule will devote separate days or half days to individual income tax issues, entity tax issues and estate planning issues.  Speakers and presentations will be announced as the program date nears to ensure coverage of the most timely and significant topics.  UF Law alumni have formed the Florida Tax Education Foundation, Inc., a nonprofit corporation, to organize the conference.”

For details about each event, please visit us online at gassmanlawassociates.com/newsandevents.html

Thank you to our law clerks that assisted us in preparing this report.

The Thursday Report – 7.25.13 – New LLC Terms, BP Oil Spill Claims and Disregarded Entities

Posted on: July 25th, 2013

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Special Anniversary Edition

6 Catastrophic BP Oil Spill Claim Mistakes, an article by John Goldsmith and Alan Gassman

Ken Crotty’s LLC Clinic – Changing Terminology in Operating Agreements Under the New Florida LLC Act

Don’t Disregard the Disregarded Entities Tax Reporting Requirements (DDD-ETRR), Part 2

New Seminar and Webinar Announcements

Research on Google

Lawyers in History: The Impact of Law Practice on Their Lives and Careers – Thomas Jefferson

More of Our Favorite Albert Einstein Quotes:

Two things are infinite: the universe and human stupidity; and I’m not sure about the universe.

If you can’t explain it to a six year old, you don’t understand it yourself.

SCHOOL’S OUT FOR SUMMER

Sanders and Alice Cooper

The above picture is real, but what Colonel Sanders and Alice Cooper said to each other is unknown, unless the FBI had a bug in the room.  Our information on the FBI and J. Edgar Hoover’s involvement with Colonel Sanders and other great Americans will be profiled next week.

We welcome contributions for future Thursday Report topics. If you are interested in making a contribution as a guest writer, please email Janine Gunyan at Janine@gassmanpa.com.

This report and other Thursday Reports can be found on our website at www.gassmanlawassociates.com.

6 Catastrophic BP Oil Spill Claim Mistakes, an article by John Goldsmith and Alan Gassman

            For those of you who missed it, we were fortunate to have attorney John Goldsmith of the Trenam Kemker law firm join us on Wednesday, July 17, 2013 and Wednesday, July 24, 2013 for two very informative webinars on the BP Oil Spill claims process.  To view the July 24 webinar please click here.   The deadline for filing a claim is April 22, 2014, but a great many claims have already been filed.  John has studied the BP situation extensively, and his firm is keeping current with settlements and pronouncements associated therewith. He has handled over 30 appeals and has received many positive results.  John has also had the opportunity to correct many errors that have been made on BP claims, and to learn from these.

BP agreed in April of 2012 to accept and pay claims made based upon the best of 171 formulas and without the need for a lawsuit or dickering over many issues.  In exchange for this BP was relieved from paying punitive damage claims in the industries this applies to.

Consequently many legal and accounting firms are actively representing BP claimants in exchange for a percentage of the recovery, but we believe that most of these firms are not aware of very important legal and practical information and needed steps and analysis that will result in their clients not receiving what would be allowed and their percentage fee being lower than it would otherwise be.  There is no doubt that plaintiff law firms will be advertising and working malpractice cases against many lawyers and accountants as a result of this.

There are many ways that a professional and his or her client can leave themselves open to settling for far less than is possible.  Six of those ways are profiled below:

1.         Not using the most-favorable method of calculating the client’s loss.

Not using the highest-yielding lost revenue calculation is perhaps the easiest way for a professional to find him or herself facing a malpractice claim.  Anyone filing a claim for economic loss is entitled to use the calculation that results in the highest dollar amount.  According to John, there are 171 different ways to calculate a client’s losses.  Failing to find and utilize the right one could have serious implications for you and your client.  Businesses located in different geographic zones (Zones A though D) will require different calculations (i.e. V Test, Modified-V Test, Decline-Only Test, etc.).

2.         Not following the BP settlement terms as to what constitutes fixed variable expenses.

Professionals calculating a client’s lost revenue must use the current claims system’s definitions of fixed and variable expenses.  These calculations have a substantial impact on the amount of a claim. The current system for filing oil spill claims, which is currently scheduled to close on April 22, 2014, stems from BP’s class action settlement agreement that was approved by the court in December 2012.  This claims system is separate from, and independent of, the original Government Accountability Project (GAP) claims system.  The GAP system used a different method of calculating fixed and variable expenses than what is stipulated in the current BP settlement agreement.

3.         Not performing a Step 2 analysis.

Not performing a Step 2 analysis may mean your client’s claim amount comes in far lower than it otherwise could have.  Calculating the dollar value of a claim based on change in net revenue is called the Step 1 analysis.  Step 2 analysis involves a company that enjoyed increasing or steady revenue early in 2010, but then faced decreased revenues in the months immediately following the April 2010 spill.  The BP claims administrator is supposed to do this Step 2 analysis, but at the same time, the administrator is not required to make assumptions that benefit the claimant.  The professional representing the claimant needs to know this extra analysis should be performed; the best way to do that is make sure the analysis is done before the claim is ever submitted.

4.         Not using the correct, or the most favorable time period for calculating your client’s claim.

One mistake being made with some of these claims is that the most-favorable time period is not being used to calculate the client’s economic loss.  To initially qualify for an oil spill claim, the claimant has to show the loss of income over a three-month period in 2010, compared with the same periods in 2009, 2008, or 2007.  What is sometimes missed, however, is the same time period does not have to be used to calculate the amount of the claim.  Simply relying on the time period used to verify initial qualification, rather than examining multiple time periods for the greatest loss, could result in a lower claim for the client and a malpractice suit for the professional.

5.         Using off-the-shelf or faulty software to calculate your client’s claim.

Relying upon faulty software and not knowing about the nuances contained in published BP administrator decisions and other under-publicized factors can hurt both claimants and the professionals attempting to help them.  There are software programs available online that assist professionals in calculating BP oil spill claims.  Some are good and some are not, but what these programs cannot do – and what it is imperative for claimant’s advocates to do – is keep abreast of the constantly changing claims administration process.  Rulings by the claims administrator affect how issues are addressed going forward; software alone cannot incorporate these changes and the resulting calculations that were right one week may be wrong the next.  Keep in mind that there are hundreds of such rulings.

6.         Not thoroughly reviewing your client’s website, press releases, and other factual circumstances.

Professionals filing BP oil spill claims need to know that a client may have his or her claim disqualified because of information released into the public domain.  Certain businesses, such as insurance companies and trust companies, are prohibited from filing claims.  If a website, press release, or even the client’s public or regulatory filings indicate that the company participates in one of the prohibited industries, the claims administrator or BP can use that as evidence that the claim should be thrown out.  Thorough representation should include a careful review of all of these materials as well as the implementation of a pre-publication review system for any new materials before their release.

It seems clear that anyone handling BP claims needs to be very careful, and it certainly appears that law firms and CPA firms should be working together, and not in lieu of one another, to make sure that the financial, logistical, and legal aspects are covered.

Under the practice of law rules it will require a lawyer to handle any appeal, and BP has apparently been appealing almost all professional service corporation and professional individual claims for losses in the past months.  Clients need to be made to understand how complicated and uncertain this process can be.

Any questions, suggestions or ideas that you might have concerning BP claims can be shared with John at jgoldsmith@trenam.com.  We are also interested in your questions, comments and suggestions on BP claims as well.

Ken Crotty’s LLC Clinic – Changing Terminology for Operating Agreements Under the New Florida LLC Act

The new Florida LLC Act has changed some of the terminology that used to exist under the old Act.  It is important that practitioners and clients be aware of these changes to avoid unintended results.  We will discuss more of these changes in future Thursday Reports and want to focus in this report on the managing member.

The Act has removed the concept of a managing member.  Under the old act, an LLC could have a managing member instead of a manager.

Under the new Act, if the operating agreement states that it has a managing member then the LLC will be treated as a member-managed LLC.  The managing member will not be considered to be a manager, and therefore the LLC will not be a manager-managed LLC.

One of the reasons this is significant to note is because if an LLC is member-managed, then the consent of all of the members is required to amend the operating agreement.  For many clients, they will not want minority members to have to consent to the amendment of an operating agreement.  Therefore, if the client has an LLC operating agreement which would be considered to be a member-managed operating agreement under the new Act, during 2014 and before the LLC elects to have the new Act applied to it, the operating agreement should be changed so that the member who was the “managing member” of the LLC is now the manager of the LLC.  As a result, the LLC would be deemed to be a manager-managed LLC and the operating agreement could be further modified without the unanimous consent of all the members.

A second reason this could be important is that the new Act requires an LLC to update its information that is stated in the Articles of Organization when it becomes inaccurate.  In a manager-managed LLC the duty to update this information falls on the manager.  However, in a member-managed LLC the members are the ones who are required to keep this information current.  This could cause a member of a member-managed LLC to have potential liability if someone relied on incorrect information in the Articles of Organization, even if such member was a minority member had no effective control over the LLC.

Don’t Disregard the Disregarded Entities Tax Reporting Requirements (DDD-ETRR), Part 2

By: Kenneth J. Crotty, J.D., LL.M.

This is part 2 of a 2 part article on this topic, which discusses electing small business trusts and other issues with disregarded entities.  Ken’s article “Disregarded Entity Reporting Requirements appears in the July 24, 2013 Business Entities Email Newsletter on the LISI network.  To read the article please click here.

If the owner of a disregarded single member LLC has exempt status from federal income tax, then the LLC is not required to (1) pay federal income tax, (2) file a federal tax return, or (3) file an informational return.  Any such requirement to file a federal tax return or informational return on behalf of the LLC is the responsibility of the owner rather than the LLC.  A disregarded entity has the option to report and pay employment tax for its employees.

The federal income tax-exempt status of the sole owner will also apply to a disregarded single member LLC.  If the owner of a disregarded LLC is claiming exempt status, the owner must treat the finances and operations of the LLC as its own for federal tax and information reporting.  The LLC’s disregarded status is with respect to its classification as a separate entity, but the LLC is treated as an activity of the sole owner.  Any entity activities that are outside the tax-exempt purposes of the sole owner may impact the tax-exempt status of the owner, and may even create tax liability.

It is important to note that if the owner of the disregarded LLC has exempt status, the LLC should not file a Form 1023 or Form 990 exemption application.  By filing this application, the previously disregarded LLC will become an organization that is treated as separate from its owner.  If the owner of the LLC is concerned that transactions with or by the LLC may cause the owner to lose its exempt status, then the owner should request a private letter ruling.

If an LLC elects to be regarded as an entity separate from its owner on a Form 8832 or becomes an entity with two or more owners, then Section 508 of the Code applies to trigger the exemption notification requirements.  Subsequently the LLC must apply for federal tax exemption recognition, within the 27 month period after the end of the month when the LLC is no longer a disregarded entity.

ESBTs (Electing Small Business Trust)

A Grantor Trust is eligible to be a shareholder of an S corporation if all of the trust is owned by an individual.  Often planners who have clients selling or gifting ownership interests in S corporations to gifting trusts that are Grantor Trusts will also have the trust make an election to become an Electing Small Business Trust or “ESBT.”  By making this election, if another person contributes assets to the gifting trust causing it to no longer be a solely owned gifting trust, this will not cause the loss of the S corporation status because an ESBT is an eligible shareholder for S corporations.

An ESBT can have multiple shareholders or beneficiaries.  It can also accumulate its own income, and may distribute both principal and accumulated income to beneficiaries.  In order to make the ESBT election:

1.         All trust beneficiaries must be individuals, estates, and charities, or must meet other specific requirements described in §170(c)(1) or §170(c)(2)-(5), as applicable;

2.         Trust interests must not be available for purchase; and

3.         The Trustee of the trust must file for the ESBT election.

Certain trusts are prohibited from making an ESBT election including (1) Qualified Subchapter S Trusts; (2) Charitable remainder annuity trusts; and (3) Charitable remainder unitrusts.

Pursuant to Treasury Regulations, an ESBT has an “S Portion,” a “non-S Portion,” and if the trust is a Grantor Trust a “Grantor Portion.”

If a solely owned Grantor Trust has made an ESBT election, then the Grantor Portion comprises 100% of the Trust.  During the lifetime of the Grantor the trust is subject to the regular taxation rules that apply to Grantor Trusts.  The Grantor’s income tax return will reflect any income, deduction and credit that can be attributed to the ESBT which is considered to be owned by the Grantor.

After the death of the grantor, the Grantor Portion ceases to exist and the items of income and deduction for the trust need to be split between the S Portion and the non-S Portion.  This point often confuses practitioners.  After the death of the grantor of a wholly owned Grantor Trust, the resulting trust or trust are not taxed as normal simple or complex trusts.

The portion of the ESBT that consists of any assets other than the S corporation stock will compromise the non-S portion.  The income included in the non-S Portion will also consist of any corporation distributions classified as dividends, as well as interest accrued for installment payments for the sale of S corporation stock.  For the non-S Portion of the trust, the taxation of this portion of the trust is governed by the normal tax rules applicable to non-Grantor Trusts.

This is not true for the S Portion of the ESBT.  The S Portion of an ESBT, that is not a Grantor Trust, is treated as a separate trust and the taxable income is calculated separately.  The income of the S Portion includes:

1.         Any gains and losses on disposition of S corporation stock;

2.         The items of income, loss, deduction or credit required to be taken into account by an S corporation shareholder by §1366 and the regulations thereunder, except for the items mentioned above in the calculation of the non-S Portion’s income;

2.         Income taxes and administrative expenses related to the assets of the S Portion of the trust and any interest expense paid or accrued on indebtedness for acquiring S corporation stock.

Generally, the income calculated for the S portion of the trust is taxed at the highest marginal rate for trusts.  It is important to note that capital gains are not subject to tax at this highest rate.

Because assets of the S Portion of the trust are a separate part of the ESBT, the income and deductions from such items are excluded when calculating the distributable net income (DNI) of the ESBT.  The S Portion is not allowed a deduction if these items are distributed to the beneficiaries and the beneficiaries may not include such distributions when calculating their personal income.

 

New Seminar and Webinar Announcements

Below we have listed our most recent webinars and seminars for your reference. 

ESTATE TREK: DEEP SPACE NINE – An Update to Our EstateView Estate Planning Software – Attendees will receive free use of our software program.

On Wednesday, July 31, 2013 at 12:30 pm, Alan Gassman, Kenneth Crotty, Christopher Denicolo and software developer David Archer will be discussing our new estate planning software and the recent updates which include a client explanation letter that will automatically calibrate to the planning strategies, inserting appropriate numbers, client names, amounts, and other data.  Attendees will receive free use of our software as beta testers.  To register for the webinar please click here

WHAT CLIENTS ARE AND ARE NOT SUITABLE FOR LONG TERM CARE INSURANCE

Rob Cochran of Long-Term Care Insurance Services, LLC in Orlando, Florida will join Alan Gassman for a webinar discussing what clients are suitable for long term care insurance on Thursday, August 29, 2013 at 5pm for a 30 minutes webinar.  Rob is the author of two books Pills and Bills and  The Truth About Long Term Care Insurance (click here for more information) To register for the webinar please click here.   We have purposefully gone outside of our market area to find Mr. Cochran in order to facilitate an objective discussion of what clients will or will not be considered as appropriate to buy long term care insurance.  Many people would be able to rely upon Medicaid and cannot afford the premiums.  Others would be able to afford home care, and it would be tax deductible.

PLANNING FOR SNOWBIRDS: Tips, Traps and Tactics for Advisors with Clients in Florida – An Encore Presentation

Bloomberg BNA Tax & Accounting will be replaying our presentation from May 28, 2013 on Planning for Snowbirds on Wednesday, August 7, 2013 at 12:30 p.m., and we will attend to provide live question and answer responses at the end of the replay.  If you want to send us any questions now we will be ready for you and also respond in writing beforehand.  The cost of this webinar is $348 for the webinar plus CD, $249 for the webinar only or $249 for the CD only.  To register for this webinar please click here.   For discount access to this product email agassman@gassmanpa.com

FINANCIAL PLANNING ASSOCIATION (FPA) TAMPA BAY 2013 FLORIDA SYMPOSIUM – A TWO DAY SEMINAR

Alan Gassman will be joining Ken Zahn, CFP at the Financial Planning Association (FPA) Tampa Bay 2013 Florida Symposium.  The Symposium is a two day event on Monday, August 19 and Tuesday, August 20.  Alan Gassman will speak Monday, August 19 at a time to be determined.

ZahnKen_160x160

Ken Zahn, is a very well known and respected CFP course author and lecturer.  He has a great sense of humor, amazing common sense, and most importantly he reads the Thursday Report.  Ken has also provided us with very good advice for the next improved version of our software.

Other notable speakers at the Symposium include Elizabeth Jetton, CFP, Linda Chamberlain, JD, CMC and Dale Van Scoyk, GFS.  On Tuesday afternoon there will be a 2 hour program that will fulfill the CFP ethics portion of the recertification process.  For more information and to register for this webinar please click here

Please plan to attend this excellent event.

AVE MARIA SCHOOL OF LAW

On April 25, 2014, Ave Maria school of law will be hosting the 1st Annual Estate Planner’s Day.

Notable speakers for the event include Professor Jerry Hesch, Jonathan Gopman and, possibly by mistake, Alan Gassman.  The event is hosted by Ave Maria School of Law in Naples, Florida and is sponsored by the law school and the Collier County Estate Planning Council. 

For more information on this event please contact agassman@gassmanpa.com.

Research on Google

If you want to see a write-up of any topic that has been covered in our Thursday Reports just search “Thursday Report Gassman” and type in the topic and you will find that every Thursday Report covering that topic comes up.  Google directs you right to the page where that topic begins.  You can also search our website directly by using the search box on the top right hand side of the page.  This way you can search not only the Thursday Report but the other resources on our website.  You can view our website by clicking here.   Rumors that the Thursday Report has acquired Google are strenuously denied.

Lawyers in History: The Impact of Law Practice on Their Lives and Careers – Thomas Jefferson

thomas Jefferson

Rounding out the month of July and the celebration of the birth of our nation, this week we are highlighting perhaps one of the most influential people of the time, Thomas Jefferson.  Born in 1743, Thomas Jefferson is noted as one of America’s Founding Fathers.  At the age of 16 Jefferson entered the College of William and Mary in Williamsburg, Virginia, where he first met George Wythe, with whom he clerked after graduating from college in only 2 years.

He practiced as a circuit lawyer for several years and represented Albemarle County in the Virginia House of Burgesses.  He was also a delegate to the Second Continental Congress beginning in June of 1775.  During his time in the Second Continental Congress, Jefferson became friendly with John Adams and Samuel Adams.  As the Congress progressed and began to consider drafting a resolution of independence a committee was formed with both Adams and Jefferson on it.  After the committee discussed the details of the document, they voted to have Thomas Jefferson write the first draft.  This document is now known as the Declaration of Independence.  Thomas Jefferson wrote the Declaration of Independence over a period of 21 days with limited time to work on the document.  He drew inspiration from the Virginia Constitution and the Virginia Declaration of Rights.

If you have not seen the musical video “1776″ you will find it to be very interest.  Also, if you have not toured Independence Hall in Philadelphia you have really missed out.

On June 28, 1776 the final draft of the Declaration was presented to Congress and after several days of debate and voting, Congress made several changes to the document, eliminating almost a fourth of the text.  The document was ratified and signed on July 4, 1776 thus beginning the start of our nation.

Before becoming president, Jefferson was involved in several different aspects of our political system including:

  • Serving in the Virginia House of Delegates from 1776 until 1779;
  • U.S. Minister to France from 1785 until 1789;
  • Elected Governor of Virginia in 1779 and re-elected in 1780;
  • Becoming the Virginia Delegate in the Congress of Confederation;
  • Proposed that American currency be based on the decimal system.  (His plan was later adopted and put into place.)
  • Served as Secretary of State in George Washington’s cabinet from 1790 to 1793 during which time his letter to President George Washington set forth the founding principles of the Democratic Party.
  • Brokered a deal for the capital to be located on the Potomac River, now Washington, D.C.

Thomas Jefferson was almost always on the edge of insolvency, yet he donated his entire personal library to become the first Library of Congress.  He is also now well known for having co-habitated with a slave, Sally Hemmings, and they had six children together, and apparently an excellent relationship.  Sally Hemmings was the daughter of planter John Wayles and an enslaved woman, Betty Hemmings.  Thomas Jefferson’s wife was Martha Wayles Skelton, daughter of the same John Wayles and therefore half-sister to Sally Hemmings. 

In 1796 Thomas Jefferson ran for President as the Democratic-Republican candidate.  He lost to John Adams but had enough votes to secure the position of Vice President.  During his term as Vice President he sought to reform the duties and abilities of the Senate.

In 1800, Jefferson was elected President of the United States during a time when the Democratic-Republican and Federalist parties were at odds with each other.  In fact, Jefferson and one of his opponents, Aaron Burr, were tied for votes in the electoral college for the position of President.  Thomas Jefferson won out over Aaron Burr, due in part to the support of Alexander Hamilton, who was later shot in a duel with Aaron Burr.  Aaron Burr became Vice President.

Jefferson was known as the “People’s President” and during his term as President:

  • Ohio was admitted to the union (we will forgive him for this).
  • He authorized the Louisiana Purchase which doubled the size of the United States;
  • He negotiated the purchase of New Orleans from France, and won, thus purchasing New Orleans (this makes up for Ohio – even Columbus was disappointed);
  • Appointed Lewis and Clark on an expedition into the newly acquired territory; and
  • The U.S. Military Academy at West Point was started.

After a second term as President, Thomas Jefferson retired and sought to establish the first college not based on the principles of a church and urged the separation of church and state.  The University of Virginia was the first college to be centered around a library rather than a chapel.

Jefferson and Adams had a well known and very intense rivalry and love-hate relationship.

On July 3, 1826, Thomas Jefferson spoke his last words to his family and friends, stating “I have done for my country, and for all mankind, all that I could do, and now I resign my soul, without fear, to my God – my daughter to my country.”  He later passed around 1pm on July 4, 1826 on the fifteenth anniversary of the Declaration of Independence.  It is interesting to note that former President John Adams also died on the same day speaking his last words “Independence forever” and “Thomas Jefferson survives.”

Applicable Federal Rates

Please click here to view a chart of this month’s, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale you can use the lowest of the 3.

Seminars and Webinars

MORE TWEAKS TO POA AND 50 SHADES OF RES JUDICATA – BINDING THE TRUST BENEFICIARY     

Please join us for this important and timely presentation – avoid being tied up in details that can cause negative client results and possible suffering.

Date: Monday, July 29, 2013 | 12:30 p.m.

Presenters: Tami Conetta, Esq. and Barry Spivey, Esq.

Location: Online webinar

Additional Information: To register for the webinar please click here.

ESTATE TREK: DEEP SPACE NICE – EVEN MORE UPGRADES TO OUR ESTATEVIEW ESTATE PLANNING SOFTWARE

ALL ATTENDEES WILL RECEIVE A LINK TO DOWNLOAD THE SOFTWARE FOR FREE THAT THEY CAN USE ON THEIR OWN CLIENT MATTERS FOR A NUMBER OF WEEKS

We now have the software issuing a client explanation letter and have improved other features as well.

Date: Wednesday, July 31, 2013 | 12:30 p.m. (30 minutes)

Presenters: Alan Gassman, Kenneth Crotty, Christopher Denicolo and David Archer

Location: Online webinar

Aditional Information: To register for the webinar please click here.

PLANNING FOR SNOWBIRDS: Tips, Traps and Tactics for Advisors with Clients in Florida – An Encore Presentation          

Our first presentation on this topic was so well received by Bloomberg BNA Tax & Accounting that they have asked us back for a replay of the original presentation.  There will be a live question and answer session at the end of the replay. 

Date: Wednesday, August 7, 2013 | 12:30 p.m.

Presenters: Alan Gassman, Gary Teblum, Kenneth Crotty and Christopher Denicolo

Additional Information: The cost of this webinar is $348 for the webinar and the CD, $249 for just the webinar or $249 for just the CD.  For more information and to register for this webinar please click here.

FINANCIAL PLANNING ASSOCIATION (FPA) TAMPA BAY 2013 FLORIDA SYMPOSIUM

Alan Gassman will be joining Ken Zahn, CFP for a joint seminar on A Brief Introduction on the Art of Wealth Protection Planning. This seminar will also include a demonstration of our new EstateView Estate Planning Software.  Attendees will also receive a link to download the software to use on their own clients matters for a number of week.  For more information and to register for this webinar please click here.

Date: Monday, August 19, 2013 | Time to be determined

Speakers: Elizabeth Jetton, CFP, Linda Chamberlain, JD, CMC, Ken Zahn, CFP and Alan Gassman, JD, LL.M.

Location: Marriott Westshore Tampa, 1001 N. Westshore Blvd, Tampa, Florida

Additional Information: For more information and to register for this webinar please click here.

  • THE JOINT EXEMPT STEP-UP TRUST (JEST)

Many lawyers are using our Joint Exempt Step Up Trust to enable clients in non-community property states to receive a stepped-up basis on all “joint trust assets” on the death of the first dying spouse.  Our Leimberg article on the Joint Exempt Step-Up Trust can be viewed by clicking here  and the accompanying chart can be viewed by clicking here.

The Ultimate Estate Planner, Inc. is also featuring our Joint Exempt Step Up Trust forms, client explanation letter and other materials on their website.  To order the forms you can click here.

Date: Wednesday, August 21, 2013 | 12pm Eastern/9am Pacific

Sponsor: The Ultimate Estate Planner, Inc.

Additional Information:  The cost of the teleseminar is $139 for the teleseminar only or $189 if you would like to receive both the teleseminar and the accompanying PowerPoint and downloadable PDF materials.  For more information and to register  please click here.

WHAT CLIENTS ARE AND ARE NOT SUITABLE FOR LONG TERM CARE INSURANCE

Date: Thursday, August 29, 2013 | 5:00 p.m.

Presneter: Rob Cochran

Location: Online webinar

Additional Information: To register for the webinar please click here.

AVOIDING THE TRAPS IN EMR/TECH CONTRACTS….NOW YOU TELL ME I’M STUCK WITH THIS FOR 5 YEARS!

Date: Tuesday, September 10, 2013 | 5:00 p.m and Thursday, September 12, 2013 | 12:30 p.m. (Each webinar will last 30 minutes)

Presenter: Sandra Greenblatt, Board Certified Health Lawyer

Location: Online webinar.

Additional Information: To register for the Tuesday, September 10, 2013, 5pm webinar please click here.  To register for the Thursday, September 12, 2013, 12:30 p.m. webinar please click here.

NIP & TUCK: MAKING THE CALL ON OFFICE-BASED SURGERY

Date: Wednesday, September 18, 2013

Presenter: Cheryl White, RN, BS, MSHL, LHRM, LNCC, MSCC, DFHRMPS and Lester Perling, J.D., MHA

Location: Online webinar

Additional Information:  To register for the webinar please click here.

NORTH SUNCOAST FICPA MONTHLY MEETING

Date: Wednesday, September 18, 2013, 4:30 – 6:30 p.m.

Speakers: Christopher Denicolo and Tom Davis will speak on the Affordable Care Act; Alan Gassman will be speaking on a topic to be determined.

Location: Chili’s in Port Richey

Additional Information: To attend this seminar please email agassman@gassmanpa.com

WEDU ESTATE PLANNING SEMINAR  

Gassman Law Associates meets Big Bird – Sesame Street vs. Wall Street?

Alan Gassman will be speaking on the topic of ASSET PROTECTION – ESSENTIAL KNOWLEDGE AND HOT TOPICS

Date: Thursday, September 19, 2013 | 7:30 am – 11:30 am

Location: WEDU PBS Berkman Family Broadcast Center – 1200 N. Blvd., Tampa, Florida

Additional Information:  If you would like to sign up for this seminar please email agassman@gassmanpa.com

NOTRE DAME TAX INSTITUTE

Jerry Hesch and Alan Gassman will be speaking on the topic of INTERESTING INTEREST QUESTIONS, PLANNING WITH LOW INTEREST LOANS, PRIVATE ANNUITIES, DEFECTIVE GRANTOR TRUSTS, AND PRIVATE AND COMMERCIAL ANNUITIES

Date: Wednesday, October 16 through Friday, October 18, 2013

Location: Notre Dame College, South Bend, Indiana

Additional Information: Professor Jerry Hesch’s Notre Dame Tax Institute will once again emphasize the importance of income tax planning and implications in addition to estate, estate tax, and related concepts.

We welcome questions, comments and suggestions for the presentation that we are assisting Jerry in preparing and presenting.

PINELLAS COUNTY ESTATE PLANNING COUNCIL HALF-DAY SEMINAR

Alan Gassman will be speaking on the topic of HOT TOPICS FOR ESTATE PLANNERS

Date: Wednesday, October 23, 2013 | 8:00 am – 12:00 p.m. (60 MINUTE PRESENTATION)

Location: TBD

Additional Information: To attend the meeting or to receive information on joining the Council please click here or email agassman@gassmanpa.com

2013 MOTE VASCULAR SURGERY FELLOWS – FACTS OF LIFE TALK SEMINAR FOR FIRST YEAR SURGEONS

Alan Gassman will be speaking on the topic of ESTATE, MEDICAL PRACTICE, RETIREMENT, TAX, INSURANCE, AND BUY/SELL PLANNING – THE EARLIER YOU START THE SOONER YOU WILL BE SECURE

Date: October 25 – 27, 2013 | Times TBD

Location: TBD

Additional Information: Please contact agassman@gassmanpa.com for additional information.

NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE) HEALTH LAW SYMPOSIUM – AN ALL DAY SEMINAR

Alan Gassman will be speaking on the topic of WHAT HEALTH LAWYERS NEED TO KNOW ABOUT FLORIDA LAW

Date: Friday, November 1, 2013 | 9am – 5pm (Mr. Gassman speaks from 1:10 pm until 2:10 p.m.)

Location: Seton Hall Law School, Newark, New Jersey

Additional Information: Seton Hall University in South Orange, New Jersey was founded in 1856, and they have remodeled since.  Today, Seton Hall has over 10,000 students in its undergraduate, graduate and law school programs and is in close proximity to several Kentucky Fried Chicken locations.

NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE)_SPECIAL 3 HOUR SESSION

Alan Gassman will be speaking on the topic of WHAT NEW JERSEY LAWYERS NEED TO KNOW ABOUT FLORIDA LAW – A 3 HOUR OVERVIEW BY ALAN S. GASSMAN

Date: Saturday, November 2, 2013

Location: Wilshire Grand Hotel, West Orange, New Jersey | 9am – 12pm

Additional Information: Please tell all of your friends, neighbors and enemies in New Jersey to come out to support this important presentation for the New Jersey Bar Association.  We will include discussions of airboats, how to get an alligator off of your driveway, how to peel a navel orange and what collard greens and grits are. For additional information please email agassman@gassmanpa.com

SALT LAKE CITY ESTATE PLANNING COUNCIL’S FALL ONE DAY “TAX AND DEDUCTIBILITY OF YOUR SKI TRIP” INSTITUTE

Alan Gassman will be speaking on the topic of PRACTICAL ESTATE PLANNING, WITH A $5.25 MILLION EXEMPTION AMOUNT

Date: Thursday, November 7, 2013

Location: Hilton Downtown Salt Lake City, Utah

Additional Information:  Please support this one day annual seminar conveniently located near skiing and tourism opportunities.  If you would like to attend this event or receive the materials please email agassman@gassmanpa.com

1st ANNUAL ESTATE PLANNER’S DAY AT AVE MARIA SCHOOL OF LAW

Speakers:  Speakers will included Professor Jerry Hesch, Jonathan Gopman, Alan Gassman and others.

Date: April 25, 2014

Location: Ave Maria School of Law, Naples, Florida

Sponsors: Ave Maria School of Law, Collier County Estate Planning Council and more to be announced.

Additional Information: For more information on this event please contact agassman@gassmanpa.com.

NOTABLE SEMINARS PRESENTED BY OTHERS:

48th ANNUAL HECKERLING INSTITUTE ON ESTATE PLANNING SEMINAR     

Date: January 13 – 17, 2014

Location:  Orlando World Center Marriott, Orlando, Florida

Sponsor: University of Miami School of Law

Additional Information: For more information please click here.

16th ANNUAL ALL CHILDREN’S HOSPITAL ESTATE, TAX, LEGAL & FINANCIAL PLANNING SEMINAR

Date: Wednesday, February 12, 2014

Location: All Children’s Hospital Education and Conference Center, St. Petersburg, Florida with remote location live interactive viewings in Tampa, Sarasota, New Port Richey, Lakeland, and Bangkok, Thailand

Sponsor: All Children’s Hospital

THE UNIVERSITY OF FLORIDA TAX INSTITUTE

Date: February 19 – 21, 2014

Location: Grand Hyatt, Tampa, Florida

Sponsor:  UF Law alumni and UF Graduate Tax Program

Additional Information:  Here is what UF is saying about the program on its website: “The UF Tax Institute will provide tax practitioners and other leading tax, business and estate planning professionals with a program that covers the most current issues and planning ideas with a practical, informative, state-of-the-art approach.  The Institute’s schedule will devote separate days or half days to individual income tax issues, entity tax issues and estate planning issues.  Speakers and presentations will be announced as the program date nears to ensure coverage of the most timely and significant topics.  UF Law alumni have formed the Florida Tax Education Foundation, Inc., a nonprofit corporation, to organize the conference.”

For details about each event, please visit us online at gassmanlawassociates.com/newsandevents.html

Thank you to our law clerks that assisted us in preparing this report.

The Thursday Report – Inaugural Edition – 7.26.2012

Posted on: July 24th, 2013

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Providing updates and comments on Florida estate planning and creditor protection developments and insight for lawyers, CPAs, and other planning professionals.

 Welcome to our first edition of The Thursday Report!

Each week we will provide a recent case or other development in summary form with analysis and ideas associated therewith. Please send us your ideas for future topics!

These reports will also be posted to our website at gassmanlawassociates.com.

We welcome all questions, comments and suggestions and thank our law clerks, Kacie Hohnadell, Allison Wallrapp, and Andrew Spence, for their efforts and dedication in assisting us with research and analysis.

Cooking Up a Fraudulent Transfer Defense

Harry Caray, one of the baseball’s best announcers, always had a way to make the game more fun. When a player knocked the ball out of the park, he would yell with enthusiasm, “it might be, it could be, it is! A home run!” The same could be said for the court’s decision in the case of In re Cook, 460 B.R. 911 (Bankr. N.D. Fla. Dec. 7, 2011), in which the debtors scored the legal equivalent of a home run.

In this case, the court found that a $175,000 investment of non-exempt funds by husband and wife into a new homestead was not a fraudulent transfer under Florida or federal bankruptcy law, despite the fact that the home was purchased only days before the bank filed a collection action and less than five months before the couple filed for bankruptcy.

In determining that the investment was not a fraudulent transfer, Judge Killian of the United States Bankruptcy Court for the Northen District of Florida stated the following on page 914: “The Debtors’ explanation that the purchase of the homestead using the non-exempt tax refund was to ensure that they had a permanent place to live is credible and realistic” and “receiving the tax refund finally give the Debtors the opportunity to procure a stable and permanent residence.”

In this case, the Cooks obtained a $3 million dollar loan to begin a car dealership business. Once the economic bubble burst in 2008, the car dealership suffered substantial losses, causing the Cooks to default on the loan and file for bankruptcy. The Cooks sold their home, once valued at $5 million, for $2.3 million to pay the remainder of the mortgage and to pay down part of the loan. The couple was then forced to move into a mobile home after being unable to afford a down payment or receive credit to purchase a new home.

In 2010, the Cooks received a tax refund of $184,769, which they used to make a down payment on a waterfront home on January 3, 2011, with a purchase price of $800,000.  The Cooks made a $155,000 cash down payment, and the seller gave them a mortgage for the remaining amount owed. In addition to the down payment, the Cooks spent $20,000 making improvements to the home.

In mid-January 2011, the bank initiated a lawsuit against the Cooks as a result of their default on the loan, and a judgment was entered against the couple in March 2011. Unable to pay the judgment, the Cooks filed for bankruptcy on May 23, 2011 and claimed the property as homestead, even though it was acquired less than five months before filing the petition (the Cooks closed on the property January 3, 2011 and filed for bankruptcy on May 23, 2011).

This was either a gutsy or foolish move on the part of the Cooks. If the court had determined that the Cooks committed a fraudulent transfer by using the tax refund to purchase the home, not only would the Cooks have lost their home, but they also would have been eternally unable to discharge the judgment owed to the bank.

In the bankruptcy hearing, the creditor objected to the homestead exemption under Section 522(o)(4) of the Bankruptcy Code, which provides that “a debtor’s homestead exemption shall be reduced to the extent that the debtor, with an intent to hinder, delay or defraud a creditor, converted non-exempt assets into exempt assets within ten years of the bankruptcy filing.”[1] However, the court found that the Cooks did not convert the non-exempt asset (tax refund) into an exempt asset (homestead property) with fraudulent intent, noting that it was reasonable for the Cooks to buy a home to ensure that they had a permanent place to live. Further, the court noted, “[w]hile it may seem unreasonable to purchase an $800,000 waterfront property after living in a mobile home, the Debtors actually went from living in a $5 million home to a home worth substantially less.”[2]

The court also determined that the couple’s equity in the home did not exceed the cap under Bankruptcy Code Section 522(p)(1), which applied in 2011 and caps the homestead exemption at $146,450 for property acquired within the 1,215 days preceding the filing of a bankruptcy; however, because the cap applies separately to each individual debtor, the couple’s cap was increased to $292,900, which allowed the entire amount of equity in the home to remain exempt.

The Trick

Debtors have the right to conduct their affairs as they see fit, and not every transfer or transaction is intended for the purpose of avoiding creditors.  Thus, if there is a good reason for the transaction, separate and apart from incidental creditor protection benefits, smart planning may allow a debtor to enter into a transaction without facing the harsh consequences of a fraudulent transfer, but this is never without risk.

Similar cases:

In the case of In re Agnew,[3] the court found that a home acquired just five days before filing for bankruptcy did not constitute a fraudulent transfer under federal Bankruptcy law and determined that the ten year look-back provision under Bankruptcy Code Section 522(o) did not apply.

In this case, a farmer owned an undivided one‑fifth (1/5) interest in farmland as well as some farming equipment.  His mother, in trust, owned the remaining four‑fifths (4/5) undivided interest in the land.  The farmer leased the 4/5 parcel from his mother for farming purposes and to live on.

Prior to filing bankruptcy (the farmer was indebted by over $130,000), he transferred his 1/5 interest in the land and his farm equipment to his mother’s trust in exchange for the parcel of land on which he lived.

Years prior to the transfer, the farmer and his mother had discussed making the transfer to ensure he would not be evicted from the home by his siblings on his mother’s death, but the farmer procrastinated making this transfer until just before filing for bankruptcy. However, just prior to making the transfer, he received economic counseling advising from an economist working in a creditor counseling program, who advised him to make this transfer.

The judge found that the values were reasonable and that the transfer should not be defeated by Bankruptcy Code Section 522(o)(4), which authorizes the reduction of the amount claimed by a bankruptcy debtor in the amount of any such property that was disposed of in a ten-year period prior to the filing of the bankruptcy petition, if the transfer was made with the intent to hinder, delay, or defraud creditors.  Thankfully for the debtor, the court found that there was no intent to defraud creditors, since the farmer’s intent was to ensure he was not evicted from his home when his mother died and the anticipated bankruptcy filing was not the reason for the transaction.

 

The Trap

If you commit a fraudulent transfer within one year of filing a Chapter 7 bankruptcy, you lose any and all rights to discharge your existing debt, which can be an extremely devastating consequence for a client who is unable to pay his or her debt. Therefore, you should be very, very careful with respect to any transfer that could be considered “fraudulent” under Florida Statutes, Section 222.29 and US Bankruptcy Code Section 727.

We hope that this weekly report reaches you well and eager to learn about the innovations happening in your professions. Please do not hesitate to contact us with any comments, questions or future topics!

As stated by the Honorable Judge Learned Hand, “[a]nyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one’s taxes. Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes any public duty to pay more than the law demands.”

Thank you to our law clerk who assisted us in preparing this report:

Kacie Hohnadell is a third-year law student at  Stetson University College of Law and is considering pursuing an LL.M. in taxation upon graduation. Kacie is also the Executive Editor of Stetson Law Review and is actively involved in Stetson’s chapter of the Student Animal Legal Defense Fund. In 2010, she received her B.A. from the University of Central Florida in Advertising and Public Relations with a minor in Marketing and moved to St. Petersburg shortly after graduation to pursue her Juris Doctor.

For details about each event, please visit us online at gassmanlawassociates.com

 

[1] 11 U.S.C. at § 522(o)(4)

[2] In re Cook, 460 B.R. 911, 914 (Bankr. N.D. Fla. Dec. 7, 2011)

[3] 355 B.R. 276 (Bankr. D. Kan.2006).

The Thursday Report – July 18, 2013, Einstein, New LLC Chart and Disregarded Entities

Posted on: July 18th, 2013

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Providing a link between Wednesday and Friday.

Special Albert Einstein Edition

How to File Tax Returns for Disregarded Entities and Grantor Trusts, with Sample Forms by Kenneth J. Crotty, J.D., LL.M.

Ken Crotty’s LLC Clinic – Increase in Non-Waivable Provisions

Last Call to Take Advantage of Ultra-Low Rates for GRATs? An Article by Stephen S. Schilling, CFA and Tara Thompson Popernik, CFA, CFP of AllianceBernstein

See Our New Seminars & Webinars Below in Blue

Lawyers in History: The Impact of Law Practice on Their Lives and Careers – John Penn 

Albert Einstein

Albert Einstein

Thursdays are an illusion albeit seemingly very real. 

While traveling on a train at 100 mph the Thursday Report remains stationary, and may therefore be equivalent to the speed of light.

E=Thursday Report3 

-        Albert “Colonel Sanders” Einstein, 1953

Princeton University, 1953 Lectures

From the book entitled My Life with Albert Einstein by Colonel Harlan Sanders

SOME OF OUR FAVORITE ALBERT EINSTEIN QUOTES:

We all know that light travels faster than sound.  That’s why certain people appear bright until you hear them speak.

The greatest mathematical discovery of all time is compound interest.

If a cluttered desk is a sign of a cluttered mind, of what, then, is an empty desk a sign?

Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of genius — and a lot of courage — to move in the opposite direction. 

For a discussion of Albert Einstein’s theory of relativity and the answer to the question as to whether light gets faster when projected from a moving object click here.

Dogs

THE THURSDAY REPORT CAN NOW BE READ ON YOUR RSS FEED.

To register the Thursday Report please use the following URL in your RSS Reader

http://gassmanlawassociates.com/feed/

For information on what an RSS feed is please click here.

We welcome contributions for future Thursday Report topics. If you are interested in making a contribution as a guest writer, please email Janine Gunyan at Janine@gassmanpa.com.  This report and other Thursday Reports can be found on our website at www.gassmanlawassociates.com.

How to File Tax Returns for Disregarded Entities and Grantor Trusts, with Sample Forms

By: Kenneth J. Crotty, J.D., LL.M.

This is part 1 of a 2 part piece on this topic.  Next week Ken will cover electing small business trusts and other issues that arise with disregarded entities.

“Disregarded entities are an illusion albeit not a reality.” – Albert Einstein

Ken Crotty of our firm has spent a lot of time preparing an explanation of how to report disregarded entities and defective grantor trusts for federal income tax purposes.

We do not believe that this material is available anywhere else.

The most common disregarded entities are single member LLCs and “defective” Grantor trusts.  As a general rule, disregarded entities and Grantor trusts are not required to obtain employer identification numbers.  However, many financial institutions require employer identification numbers for income reporting purposes and will not allow the social security number of the owner or Grantor to be used.

Reporting Disregarded Entities

If a disregarded entity has an employer identification number and the ownership of the entity changes so that it no longer qualifies as a disregarded entity, the disregarded entity should retain its old employer identification number.  For example, if a disregarded single member LLC has an employer identification number, and then a second member buys into the LLC so that it is now treated as a partnership, the partnership should continue using the employer identification number that was assigned to the LLC when it was disregarded.

Generally disregarded entities do not need to file a separate tax return.  The items of income and deduction from the activities of the disregarded entity will be picked up on the owner=s tax return on the following Schedules:

Schedule C B Profit or Loss from Business (sole proprietorship)

Schedule E B Supplemental Income or Loss

Schedule F B Profit or Loss from Farming

The disregarded entity is treated as separate from its owner for employment tax purposes for wages paid on or after January 1, 2009 and for excise taxes reported and paid on Forms 720, 730, 2290, 11-C, or 8849 after December 31, 2007.  In these situations, the employment tax and excise tax return instructions should be reviewed to be certain that the disregarded entity is reporting the necessary information.

Reporting Grantor Trusts

If a trustee is not using one of the optional methods of filing, which are discussed below, and the entire trust is a Grantor trust, the trustee need only fill in the entity information on the Form 1041 and not show any dollar amounts on the Form 1041 itself.  Instead, the trustee should show the dollar amounts on attachments to the Form 1041.   The attachment should not be a Schedule K-1. The trustee must give the Grantor of the trust a copy of the attachment.

If the trust is only partially by a Grantor trust, then the items of income and deduction for the non-Grantor portion of the trust should be reported on the Form 1041 as normally would be done and the portion of the items treated as owned by a Grantor trust should be shown on an attachment.

The attachment must show the name, identifying number, and address of the persons to whom the income is taxable.  The income must be reported in the same detail as it would be reported on the Grantor=s income tax return if it had been received directly by the Grantor.  Any deductions or credits that apply to the income also need to be reported in the same detail as they would be if they had been received directly by the Grantor.  The Grantor then reports the items of income, deductions and credits on the Grantor=s personal return.

For Grantor trusts, there are three optional methods of filing, which the trustee may choose instead of filing the Form 1041.  If a trust is treated as owned by one person, then the trustee may select Option 1 or Option 2 described below.  If a husband and wife are treated as the owners of a trust, they will be deemed to be one person and therefore the trustee may select either Option 1 or Option 2 below.  If the trust is treated as owned by more than one person, then the trustee may select Option 3 below.

You can click here to see the sample documentation to be used to inform the IRS that a trust is disregarded for income tax purposes.  There is a sample default Form 1041 which can be filed for a Grantor Trust.  Also provided are samples showing the reporting necessary under Option 1 and Option 2.

Option 3 has the same reporting requirements as Option 2 but only applies in situations where there is more than one Grantor, and the Grantors are not husband and wife.  In this situation the trustee needs to determine which portion of the trust assets were payable to Grantor 1 and which portion of the trust assets were payable to Grantor 2.  The trustee would then provide each of Grantor 1 and Grantor 2 with the same information as shown under Option 2.

Option 1:        The trustee must give all of the payers of income during the year to the trust the social security number of the individual treated as the owner of the trust and the trust=s address.  To use this method, the owner of the trust must provide the trustee with a signed W-9.  If the owner of the trust is not the trustee or co-trustee, then the trustee must (1) give the owner a statement showing all of the items of income, deduction, and credit of the trust; (2) identify the payer of each item of income; (3) explain how the owner takes such items into account when preparing the owner’s tax return; and (4) inform the owner that these items must be included on his or her tax return.  If the trustee reports under Option 1 and the trust does not have an employer identification number, the trust does not need to obtain an employer identification number to satisfy Option 1.

Option 2:        The trustee must give all of the payers of income during the year to the trust the full name of the trust, the trust=s address and the trust=s tax identification number.  The trustee also must file with the IRS the appropriate Forms 1099 to report the income paid to the trust during the tax year.  These forms show the trust as the payer and the individual treated as the owner of the trust as the payee.  If the owner of the trust is not the trustee or co-trustee, then the trustee must (1) give the owner a statement showing all of the items of income, deduction, and credit of the trust; (2) explain how the owner takes such items into account when preparing the owner=s tax return; and (3) inform the owner that these items must be included on his or her tax return.  If the trustee reports under Option 2 and the trust does not have an employer identification number, the trust needs to obtain an employer identification number to satisfy Option 2.

Option 3:        The trustee must give all of the payers of income during the year to the trust the full name of the trust, the trust=s address and the trust=s tax identification number.  The trustee also needs to file with the IRS the appropriate Forms 1099 to report the income paid to the trust during the tax year.  These forms would show the trust as the payer and the owners as the payees.  The trustee must (1) give each owner a statement showing all of the items of income, deduction, and credit of the trust attributable to such owner; (2) explain how each owner takes such items into account when preparing his or her tax return; and (3) inform each owner that these items must be included on his or her tax return.  If the trustee reports under Option 3 and the trust does not have an employer identification number, the trust needs to obtain an employer identification number to satisfy Option 3.

If a trustee has been filing a Form 1041, the trustee can change to one of the three optional methods listed above at any time.  The trustee can do this by filing a final Form 1041 for the tax year immediately preceeding the first tax year that the trustee elects to use one of the optional methods of filing.  On the form of the final Form 1041, the Final return box in item F must be checked and the words “Pursuant to section 1.671-4(g), this is the final Form 1041 for this grantor trust” should be written on the first page of the Form 1041.

The filing of the relevant 1099s by the trustee, in relation to Options 2 and 3 above depends on the type of income for the Trust.  For example the turstee may be required to file a 1099-DIV for dividend income and file a 1099-INT for relevant interest income.

In relation to the reporting of income from long-term gain or loss from a partnership, S Corporation, or trust, Treasury Regulation 1.671-4(b)(5) provides that in the case of a trust that owns an interest, the distributive share belonging to the trust as a partner, shareholder, or beneficiary will not be includable by the trustee on any Form 1099 because the distributive share is reportable by the partnership, S corporation, or trust on the Schedule K-1.

Certain trusts are not allowed to use the optional filing methods.  These include the following:

1.         The common trust fund;

2.         A foreign trust or trust that has any of its assets located outside of the United States;

3.         A qualified Subchapter S trust;

4.         A trust which is treated as owned by one or more individuals who have a tax year other than a calendar year;

5.         A trust which is owned by one or more persons who are not U.S. persons; and

6.         A trust which is owned by one or more persons if at least one person is an exempt recipient for informational reporting purposes unless at least one other person is not an exempt recipient and the trustee reports the information without treating any of the owners as exempt recipients.

Ken Crotty’s LLC Clinic – Increase in Non-Waivable Provisions

The new LLC Act is a “default” act which generally allows the parties to customize the Operating Agreement for the LLC based on the agreement of the members.  However, some provisions may not be waived or modified.  Compared to Section 608.423 of the old act, Section 605.0105 of the new Act greatly expands these non-waiveable provisions.  The chart below compares these two Sections showing the differences.

We thank recent Stetson Law School graduate, Corinna Cicmanec who will be attending the University of Florida Tax Program this coming semester, for preparing the following chart and putting up with us for most of the summer.  Congratulations Corinna and enjoy your time in Gainesville relaxing with the Internal Revenue Code.

 

Provision

Old – §608.423 New – §605.0105

The Operating Agreement

The operating agreement:-        Regulates the conduct and affairs of the LLC;-        Establishes duties; and-        Governs relations between the members, and the members and the LLC Operating agreement specifically governs:

  1.  Relations between members, and between members and the LLC
  2. The rights and duties of managers
  3. The conduct of activities and affairs of the LLC
  4. Means and conditions of amending the operating agreement

Agreement Limitations

Cannot unreasonably restrict the right to information or access to records under §608.4101 (right to information provision) Cannot unreasonably restrict the right to information or access to information, but can impose reasonable restrictions on the availability and use of info, and may define appropriate remedies for breach of a reasonable restriction on use.
Cannot eliminate the duty of loyalty, but can:-        Identify activities that are not in violation of the duty of loyalty if not unreasonable; and-        Specify a number or percentage of members or disinterested managers that can authorize, or ratify, an act or transaction as not violating the duty of loyalty if all material facts were disclosed. Cannot eliminate the duty of loyalty or duty of care (under §605.04091, standards of conduct for members and managers), except for the rules that allowed under subsection 4 (see below)
-        Cannot unreasonably reduce the duty of care under §608.4225 Cannot eliminate the duty of loyalty or duty of care (under §605.04091, standards of conduct for members and managers), except for the rules that allowed under subsection 4 (see below)

Cannot eliminate the obligation of good faith and fair dealing, but can make standards of measurement for such obligation as long not manifestly unreasonable

Cannot vary requirement to wind up LLC’s business

Cannot restrict the rights of a person (other than manager, member or transferee of a member’s distributional interest) Cannot restrict the rights of a person, except as provided in the operating agreement
Cannot vary the capacity of LLC to sue or be sued
Cannot vary governing law
Cannot vary requirement, procedure, or other provisions regarding:-     Registered agents; orThe department, including records authorized or required to be delivered to the department for filing
-     Cannot vary the provisions regarding the signing and filing pursuant to judicial order
Cannot relieve or exonerate a person from liability for conduct involving bad faith, willful or intentional misconduct, or a knowing violation of law
Cannot vary the power of a person to disassociate, except to require notice of a person’s intent to withdraw (under §605.0602(1)) to be in a record
Cannot vary the grounds for judicial dissolution (as stated in chapter)
Cannot restrict the rights of a member to maintain an action under:-        The direct action of a member;-        A derivative action;-        Proper plaintiff;-        Special litigation committee (agreement can provide that the LLC may not appoint the committee, but cannot prevent the court from doing so);-        Proceeds and expenses; or

Voluntary dismissal or settlement; notice.

-        Cannot vary the right of a member to approve a merger, interest exchange or conversion
Cannot vary the contents of a plan of merger, interest exchange, conversion or domestication

Last Call to Take Advantage of Ultra-Low Rates for GRATs? An Article by Stephen S. Schilling, CFA and Tara Thompson Popernik, CFA, CFP of AllianceBernstein

People

Matt Gordon from AllianceBernstein’s Tampa office is a very well informed and dedicated advisor who has provided us with the following article prepared by AllianceBernstein’s amazing planning team.  Matt’s contact information is as follows:

Matthew Gordon
Bernstein Global Wealth Management
101 East Kennedy Blvd.
Suite 3200
Tampa, FL 33602
matthew.gordon@bernstein.com
Phone: 813-314-3328

Anyone considering a long-time GRAT or a QPRT should read this article and share it with clients and other advisors.

Steve S. Schilling is a Director in Bernstein’s Wealth Management Group and is based in the firm’s San Francisco office. He advises Bernstein’s Bay Area and Pacific Northwest clients regarding complex investment planning issues; his areas of expertise include diversification planning for holders of concentrated portfolios, multigenerational wealth transfer, philanthropy and pre-transaction planning. Schilling joined the firm in 2000 and has been a member of the Wealth Management Group since 2003, serving as an analyst and senior analyst before becoming a Director in 2009. Schilling earned a BA in economics from the University of California, Santa Barbara, and is a Chartered Financial Analyst charter holder.

Tara Thompson Popernik was named the Director of Research for the Wealth Management Group in 2011 and is responsible for leading research initiatives on investment planning and asset allocation issues facing high-net-worth families, family offices, and endowments and foundations. Previously, she was a wealth management specialist, and before that she was a senior investment planning analyst. Prior to joining the firm in 2003, Popernik was a paralegal in the Capital Markets Group of Cadwalader, Wickersham & Taft. She earned a BA with honors in comparative literature from Dartmouth College. Popernik is a CFA charter holder and a Certified Financial Planner certificant.

US investors interested in establishing a “zeroed-out” Grantor Retained Annuity Trust (GRAT) should consider acting fast to complete their transactions before rising interest-rates diminish their potential value—preferably before the end of July.

The “zeroed-out” GRAT has been a popular estate planning vehicle for many years because it can transfer wealth to the next generation while using little or none of the $5.25 million applicable exclusion amount (the money that you can give away either during your life or at death before gift or estate taxes kick in). That leaves all or most of the applicable exclusion available to shelter assets from estate tax. At an individual’s death, the cost basis for appreciated assets is increased to fair market value so the potential income tax on the appreciation is eliminated. This “step-up” has become even more valuable with the increase in US income tax rates effective 2013.

The key to a zeroed-out GRAT is that the present value of the annuity payments retained by the grantor must equal (or zero out) the value contributed to the GRAT, so that there is no taxable gift. Anything remaining in the trust after the annuities have been paid passes to the beneficiary’s gift tax-free. How large the annuity payments must be to zero-out the GRAT is based on current interest rates.  Lower interest rates are better because they lower the required annuity payments, and thus increase the chances that there will be something left over for heirs.

The Internal Revenue Service sets the required annuity rate for newly established GRATs each month, based on Treasury yields. The rate has fluctuated from an all-time high of 11.6% in 1989 to an all-time low of 1.0% in January 2013. The July rate of 1.4% reflects Treasury yields from May 15 through June 14, so it does not reflect the recent spike in bond yields; the August rate will.

Based on a methodology we believed to be similar to the IRS methodology, we predict that the August rate will be 2.0%, and, if current Treasury yields persist, the September rate will be 2.2%. So, there’s likely to be a significant benefit to completing a GRAT transaction before the end of July.

To give clients a sense of the large impact that interest rates can have on the success of longer-term GRATS, we estimated the remainder value of GRATs established under different historical conditions. In each case, a 10-year GRAT is established with $1 million invested in the S&P 500. For GRATs established in the quintile of months when the 7520 rate was lowest (between 1.2% and 2.6%), the median remainder value would have been about $2.1 million, almost four times the $533,000 median remainder value of GRATs established in the second quintile of months, when the 7520 rate was between 2.6% to 5.2%.*

[NOTE FROM THURSDAY REPORT EDITORS: We certainly hope that the interest rates will not go up to 5.2% any time soon! That is like having to pay $50 for a bucket of chicken!]

The good news is that there are still three weeks left to take advantage of the July rate, and the August rate will still fall within the lowest quintile of historical rates. But the window for locking in a low rate for a longer term GRAT strategy may be closing, as the days of hurdle rates below 2% may soon be at an end.

*This analysis includes 745 10-year periods, beginning monthly from 1941 through May 2003; using a proxy for the 7520 rate before 1989 based on IRS methodology. All strategies funded with $1 million. All assets are invested in an S&P 500 index. Wealth to beneficiaries is adjusted for inflation over the applicable time horizon.

The views expressed herein do not constitute, and should not be considered to be, legal or tax advice, and there is no relationship between AllianceBernstein and Colonel Sanders. The tax rules are complicated, and their impact on a particular individual may differ depending on the individual’s specific circumstances. Please consult with your legal or tax advisor regarding your specific situation. 

Click here to see our chapter on Grantor Retained Annuity Trusts in the Bloomberg BNA Estate Tax Planning in 2011 and 2012 book co-written by Alan S. Gassman, Kenneth J. Crotty and Christopher J. Denicolo.

Our Most Recent Seminar and Webinar Announcements

Below we have listed our most recent webinars and seminars for your reference.  We are also going to be sending these to you as a separate announcement.

BP OIL SPILL CLAIMS: AVOID MISTAKES AND MAXIMIZE CLAIMS

On Wednesday, July 24, 2013 at 12:30 p.m. please join John Goldsmith of the Trenam Kemker Law Firm and Alan Gassman for a 45 minute webinar regarding BP Oil Spill Claims.  There is a lot of criteria and options when seeking a claim and this webinar lays them out in a clear and understandable fashion. To register for the webinar please click here.

NOTE: This presentation was also given on Wednesday, July 17, 2013.  If you would like a copy of the video and the accompanying PowerPoint presentation please email Janine Gunyan at Janine@gassmanpa.com

THE 444 SHOW (a monthly online webinar series) on The Last Legislative Session and The Florida Bar’s Legislative Efforts

Please join us for the 444 Show on Thursday, August 22, 2013 at 4pm.  The 444 Show is a monthly webinar series sponsored by the Clearwater Bar Association and moderated by Alan S. Gassman.  Each show qualifies for 1 hour of continuing education credit.

We are pleased to welcome Sandra Diamond of Williamson, Diamond & Caton, PA., and Aimee Diazlyon and Jim Daughton who are the legislative consultants for The Florida Bar to this month’s show.  They will be speaking on the last legislative session and The Florida Bar’s legislative efforts.

To register for the webinar please click here.

WEDU 8th ANNUAL ESTATE & TAX PLANNING CONTINUING EDUCATION SEMINAR

Join speakers Daniel A Smith and Alan S. Gassman for the WEDU 8th Annual Estate and Tax Planning Seminar on Thursday, September 19, 2013.  The seminar starts at 7:30 am with a hot breakfast and goes until 11:30 am.  Tickets are $50 and includes breakfast.  Topics include: Coming Shifts in Estate Planning by Daniel A. Smith, Asset Protection by Alan S. Gassman and a panel discussion on Income Tax Reduction Strategies and 1041 Issues.

Daniel A. Smith’s extensive real-world experience brings his classroom information into immediate, practical, and applicable form. He specializes in integrating sales and relationship management with the complexities of estate planning, estate taxation, charitable giving, and investment management issues of the High Net Worth and Ultra High Net Worth client. Prior to joining Cannon in 1990, Daniel was a Trust Services Officer at First Hawaiian Bank and an Account Executive with Dean Witter Reynolds (now Morgan Stanley).  His years of experience with Cannon have added best practices from constant interaction with many of the nation’s top financial advisors and wealthy individuals.

When not teaching at Cannon Schools, Daniel is a frequent speaker at banks, trust companies, brokerage firms and other financial services companies nationwide. He also speaks at financial services conferences on estate planning, taxation, sales, sales management, quality service and industry trends. His work has been published in Trusts & EstatesRegistered Rep and other industry publications.  Daniel’s On Site training addresses sales and service issues and technical topics related to personal trust, investments, and estate planning. His consulting work is focused on developing custom sales presentation materials and computer-based training.

For more information and to register please visit http://www.wedu.org/events/ceseminar/

Lawyers in History: The Impact of Law Practice on their Lives and Careers: John Penn

Penn

As we continue to celebrate the month of July and the birth of our nation we recognize one of the signers of the Declaration of Independence, John Penn. Penn was born on May 17th, 1741 in Caroline County, Virginia. John Penn is not a man that is commonly recognized for his participation in the signing of the Declaration of Independence. In fact he is commonly mistaken for another John Penn, the grandson of William Penn, the founder of Pennsylvania. Although cast in the shadows, Penn was a courageous man that left his mark on one of the most important documents signed in United States history.

In addition, Penn accomplished many feats for a single child that came from a family that did not put education first. Penn attended a common school for only two years because his father did not consider education to be of importance. However, when his father died and his widowed mother became unable to support and care for herself and the farm that was left behind, Penn sought advice from his uncle, Edmund Pendleton, who was an esteemed attorney (stay tuned to a future Thursday Report on Edmund Pendleton and his practice of law). Pendleton was known for writing George Washington’s will the night before Washington was appointed Commander in chief by the Continental Congress and was described by his friend Thomas Jefferson as “the greatest orator” in the colonies. Penn, motivated by his father’s death, followed in the footsteps of his uncle, and with exposure to some of the finest lawyer’s in Virginia and one of the best libraries throughout the colonies, Penn became a member of the Virginia Bar only three years after his father’s death at the age of 21.

After practicing law in Virginia for twelve years, Penn moved his family to Williamsboro, North Carolina, for reasons that are not entirely clear. However, one reason Penn may have relocated may be due to the charges he was facing in Virginia for being disrespectful and making treasonous remarks about King George. (Anyone who is reading this wins a prize by clicking the next link.) It was believed that Penn made these remarks in a public meeting where he was then reported to royal authorities regarding his opposition to the King’s taxes and duties being imposed on the colonies.  Penn was found guilty and fined one penny, however he refused to pay the fine.

Penn was on the fast track for independence and his move to North Carolina gave him the opportunity to express his interest in liberty and to speak to those who would support him in his journey. After being accepted and recognized as a leader in North Carolina through his law firm and his role in politics, Penn arrived in Congress and declared, “My first wish is for America to be free.” The following are a few of Penn’s accomplishments:

  • Penn served in the Continental Congress for six years;
  • He signed the Declaration of Independence
  • He signed the Articles of Confederation
  • He signed the Halifax Resolves (the North Carolina Constitution)
  • He was virtual dictator of North Carolina at what many consider to be the turning point of the American Revolution in 1781-1782.

After being part of one of the most historical moments in United States history and serving in Congress for six years, John Penn died near his home in North Carolina on September 14th, 1788.

Here is the link referred to above.

Applicable Federal Rates

Please click here to view a chart of this month’s, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale you can use the lowest of the 3.

Seminars and Webinars

  • MEDICAL EDUCATION RESOURCES PRIMARY CARE CONFERENCE

Alan Gassman will be speaking on the topic of LEGAL, TAX AND FINANCIAL BOOT CAMP FOR THE MEDICAL PRACTICE – A SPECIAL TAX, ESTATE PLANNING AND LAW CONFERENCE FOR PRIMARY CARE PHYSICIANS

Date: July 19 – 21, 2013 (Friday – Sunday mornings; Have fun at Disney in the afternoons and we will not ask what you do at night!)

Topic:         1)             The 10 Biggest Mistakes That Physicians Make In Their Investments and Business Planning

                                                9am – 10am on Friday, July 19, 2013

                    2)             Lawsuits 101

                                                10:10 am – 11:10 am on Friday, July 19, 2013

                    3)             Essential Estate Planning

                                                11:10 am – 11:40 am on Friday, July 19, 2013

                    4)             Asset Entity Planning for Creditor Protection and Buy Sell Arrangements

                                                10:10 am – 11:10 am on Saturday, July 20, 2013

                    5)             50 Ways to Leave Your Overhead – How to Enhance Medical Practice Profitability

                                                11:40 am – 12:40 pm on Saturday, July 20, 2013

                    6)             Stark Naked, or Well Prepared? – Health Law Compliance

                                                9:00 am – 10:00 am on Sunday, July 21, 2013

Location: Disney’s Boardwalk Resort, Orlando, Florida

Topics by Other Speakers: 2013 Tax Changes, Tax Deductions for Physicians, Medical Practice Financial Management, Physician Compensation, Tax Structures for Medical Practices and Retirement Plan Options for Physicians.

Additional Information:  For more information please visit www.MER.org  Please note that the program qualifies for continuing education credit for physicians.

  • THE JOINT EXEMPT STEP-UP TRUST (JEST)

Date: Wednesday, August 21, 2013 | 12pm Eastern/9am Pacific

Sponsor: The Ultimate Estate Planner, Inc.

Additional Information:  If you would like to attend this teleconference please click here to register

  • NEW CHANGES TO THE FLORIDA TRUSTS & ESTATES TAX AND DURABLE POWER OF ATTORNEY ACT

Date: Monday, July 29, 2013 | 12:30 p.m.

Presenters: Tami Conetta, Esq. and Barry Spivey, Esq.

Location: Online webinar

Additional Information: To register for the webinar please click here.

  • AVOIDING THE TRAPS IN EMR/TECH CONTRACTS….NOW YOU TELL ME I’M STUCK WITH THIS FOR 5 YEARS!

Date: Tuesday, September 10, 2013 | 5:00 p.m and Thursday, September 12, 2013 | 12:30 p.m. (Each webinar will last 30 minutes)

Presenter: Sandra Greenblatt, Board Certified Health Lawyer

Location: Online webinar.

Additional Information: To register for the Tuesday, September 10, 2013, 5pm webinar please click here. To register for the Thursday, September 10, 2013, 12:30pm webinar please click here.

  • NIP & TUCK: MAKING THE CALL ON OFFICE-BASED SURGERY

Date: Wednesday, September 18, 2013

Presenter: Cheryl White, RN, BS, MSHL, LHRM, LNCC, MSCC, DFHRMPS and Lester Perling, J.D., MHA

Location: Online webinar

Additional Information:  To register for the webinar please click here

  • NORTH SUNCOAST FICPA MONTHLY MEETING

Date: Wednesday, September 18, 2013, 4:30 – 6:30 p.m.

Speakers: Alan Gassman will be speaking on the Affordable Care Act.

Location: Chili’s in Port Richey

Additional Information: To attend this seminar please email agassman@gassmanpa.com

  • WEDU ESTATE PLANNING SEMINAR

Gassman Law Associates meets Big Bird – Sesame Street vs. Wall Street?

Alan Gassman will be speaking on the topic of ASSET PROTECTION – ESSENTIAL KNOWLEDGE AND HOT TOPICS

Date: Thursday, September 19, 2013 | 7:30 am – 11:30 am

Speakers/Topics: Daniel A. Smith of Cannon Financial Institute will speak on Coming Shifts in Estate Planning, and Alan S. Gassman will speak on Asset Protection.  There will also be a panel discussion on Income Tax Reduction Strategies & 1041 Issues.

Location: WEDU PBS Berkman Family Broadcast Center, 1300 N Blvd., Tampa, FL

Additional Information:  For more information or to register for this seminar please click here

  • NOTRE DAME TAX INSTITUTE

Jerry Hesch and Alan Gassman will be speaking on the topic of INTERESTING INTEREST QUESTIONS, PLANNING WITH LOW INTEREST LOANS, PRIVATE ANNUITIES, DEFECTIVE GRANTOR TRUSTS, AND PRIVATE AND COMMERCIAL ANNUITIES

      Date: Wednesday, October 16 through Friday, October 18, 2013

      Location: Notre Dame College, South Bend, Indiana

Additional Information: Professor Jerry Hesch’s Notre Dame Tax Institute will once again emphasize the importance of income tax planning and implications in addition to estate, estate tax, and related concepts.

Email us now to get your football tickets to the Notre Dame-USC game on October 19.

We welcome questions, comments and suggestions for the presentation that we are assisting Jerry in preparing and presenting.

  • PINELLAS COUNTY ESTATE PLANNING COUNCIL SEMINAR

Alan Gassman will be speaking on the topic of HOT TOPICS FOR ESTATE PLANNERS

Date: Wednesday, October 23, 2013 | 8:00 am – 12:00 p.m. (60 MINUTE PRESENTATION)

Location: TBD

Additional Information: To attend the meeting or to receive information on joining the Council please click here or

email agassman@gassmanpa.com

  • 2013 MOTE VASCULAR SURGERY FELLOWS – FACTS OF LIFE TALK SEMINAR FOR FIRST YEAR SURGEONS

Alan Gassman will be speaking on the topic of ESTATE, MEDICAL PRACTICE, RETIREMENT, TAX, INSURANCE, AND BUY/SELL PLANNING – THE EARLIER YOU START THE SOONER YOU WILL BE SECURE

Date: October 25 – 27, 2013 | Times TBD

Location: TBD

Additional Information: Please contact agassman@gassmanpa.com for additional information.

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE) HEALTH LAW SYMPOSIUM – AN ALL DAY SEMINAR

Alan Gassman will be speaking on the topic of WHAT HEALTH LAWYERS NEED TO KNOW ABOUT FLORIDA LAW

Date: Friday, November 1, 2013 | 9am – 5pm (Mr. Gassman speaks from 1:10 pm until 2:10 p.m.)

Location: Seton Hall Law School, Newark, New Jersey

Additional Information: Seton Hall University in South Orange, New Jersey was founded in 1856, and they have remodeled since.  Today, Seton Hall has over 10,000 students in its undergraduate, graduate and law school programs and is in close proximity to several Kentucky Fried Chicken locations.

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE)_SPECIAL 3 HOUR SESSION

Alan Gassman will be speaking on the topic of WHAT NEW JERSEY LAWYERS NEED TO KNOW ABOUT FLORIDA LAW – A 3 HOUR OVERVIEW BY ALAN S. GASSMAN

Date: Saturday, November 2, 2013

Location: Wilshire Grand Hotel, West Orange, New Jersey | 9am – 12pm

Additional Information: Please tell all of your friends, neighbors and enemies in New Jersey to come out to support this important presentation for the New Jersey Bar Association.  We will include discussions of airboats, how to get an alligator off of your driveway, how to peel a navel orange and what collard greens and grits are. For additional information please email agassman@gassmanpa.com

  • SALT LAKE CITY ESTATE PLANNING COUNCIL’S FALL ONE DAY “TAX AND DEDUCTIBILITY OF YOUR SKI TRIP” INSTITUTE

Alan Gassman will be speaking on the topic of PRACTICAL ESTATE PLANNING, WITH A $5.25 MILLION EXEMPTION AMOUNT

Date: Thursday, November 7, 2013

Location: Hilton Downtown Salt Lake City, Utah

Additional Information:  Please support this one day annual seminar conveniently located near skiing and tourism opportunities.  If you would like to attend this event or receive the materials please email agassman@gassmanpa.com

NOTABLE SEMINARS PRESENTED BY OTHERS:

  • 48th ANNUAL HECKERLING INSTITUTE ON ESTATE PLANNING SEMINAR

Date: January 13 – 17, 2014

Location:  Orlando World Center Marriott, Orlando, Florida

Sponsor: University of Miami School of Law

Additional Information: For more information please visit: http://www.law.miami.edu/heckerling/

  • 16th ANNUAL ALL CHILDREN’S HOSPITAL ESTATE, TAX, LEGAL & FINANCIAL PLANNING SEMINAR

Date: Wednesday, February 12, 2014

Location: All Children’s Hospital Education and Conference Center, St. Petersburg, Florida with remote location live interactive viewings in Tampa, Sarasota, New Port Richey, Lakeland, and Bangkok, Thailand

Sponsor: All Children’s Hospital

  • THE UNIVERSITY OF FLORIDA TAX INSTITUTE

Date: February 19 – 21, 2014

Location: Grand Hyatt, Tampa, Florida

Sponsor:  UF Law alumni and UF Graduate Tax Program

Additional Information:  Here is what UF is saying about the program on its website: “The UF Tax Institute will provide tax practitioners and other leading tax, business and estate planning professionals with a program that covers the most current issues and planning ideas with a practical, informative, state-of-the-art approach.  The Institute’s schedule will devote separate days or half days to individual income tax issues, entity tax issues and estate planning issues.  Speakers and presentations will be announced as the program date nears to ensure coverage of the most timely and significant topics.  UF Law alumni have formed the Florida Tax Education Foundation, Inc., a nonprofit corporation, to organize the conference.”

  • 1st ANNUAL ESTATE PLANNER’S DAY AT AVE MARIA SCHOOL OF LAW

Speakers:  Speakers will include Professor Jerry Hesch, Alan Gassman and others.

Date: April 25, 2014

Location: Ave Maria School of Law, Naples, Florida

Sponsors: Ave Maria School of Law, Collier County Estate Planning Council and more to be announced.

Additional Information: For more information on this event please contact Jonathan Gopman at jonathan.gopman@akerman.com.  We thank Jonathan for all of his hard work to put this very special day together.

For details about each event, please visit us online at gassmanlawassociates.com/newsandevents.html

 

The Thursday Report – July 11, 2013, Same-Sex Chart and Gandolfini

Posted on: July 11th, 2013

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“Bringing New Meaning to Thursdays Throughout The Week – It’s Not Just the Day Before Friday Anymore!”

Why Many Same-Sex Couples Will Be Looking to Leave Florida and Where They May Go by Christopher J. Denicolo, J.D., LL.M.

What Your Clients Want to Know About James Gandolfini – A look at his Last Will and Testament and What Was Wrong With It – A LISI Article by Bruce Steiner

Ken Crotty’s LLC Clinic

Registration is Now Open for the Notre Dame Tax & Estate Planning Institute in October

Back by Popular Demand – Join us for our August 23, 2013 Presentation of the JEST Trust System as part of Phil’s Ultimate Estate Planner, including New Materials and Forms

Lawyers in History: The Impact of Law Practice on Their Lives and Careers – Aaron Burr

Today’s Thursday Report concentrates on two very important recent developments for estate tax planners, and providing our readers with more information and thinking than has been published by the conventional press and industries to date.

Clients want to know how these laws will affect them, their families, and their friends and colleagues.

We hope that today’s issue gives you solid information and planning ideas that you can offer to same-sex couples, and a thorough and interesting discussion of James Gandolfini’s estate plan, and what can be learned from this. 

We welcome all comments, questions (and complaints about the Kentucky Fried Chicken jokes) that we receive. 

The best suggestion award in response to this Thursday Report will be the coupon found below.  DON’T LEAVE HOME WITHOUT IT

 Certificate.FINAL

We welcome contributions for future Thursday Report topics. If you are interested in making a contribution as a guest writer, please email Janine Ruggiero at Janine@gassmanpa.com.

 This report and other Thursday Reports can be found on our website at www.gassmanlawassociates.com.

Why Many Same-Sex Couples Will Soon Be Looking to Leave Florida and Where They May Go

by Christopher J. Denicolo, J.D., LL.M.

            Almost everyone reading this report knows that the U.S. Supreme Court has held that same-sex couples cannot be denied equal protection under Constitution if they were legally married in a state that allows same-sex marriage, and reside in a state that recognizes same-sex marriage.

Florida does not recognize same-sex marriage, so same-sex couples who have been married in one of the states (or foreign jurisdictions) that recognize same-sex marriages will not be considered as married for federal tax and other federal law purposes if they reside in Florida at the time of death.

There are many other federal and state rights that are impacted by whether a validly married same-sex couple resides in a state that recognizes same-sex marriages.

In the Windsor case, Thea Spyer and Edith Windsor lawfully married in Ontario, Canada under Canadian law, while they resided in New York.  While New York did not allow same-sex marriages at the time, it did recognize same-sex marriages that were legal in out-of-state jurisdictions.  The IRS therefore lost its case against Ms. Windsor, who claimed the estate tax marital deduction as being a “spouse.”

Significantly more detail on the above can be found by clicking here.

The Windsor case leaves Florida same-sex couples in a quandary.  Do they stay in Florida, unable to make significant gifts to one another, and risking the payment of federal estate tax on the death of a wealthy spouse, or should they move their domicile, and thus their primary residence, to a state that does recognize same-sex marriages?

One question is what states they can move to, and how the tax law and creditor protection laws apply in each such state.

We have a chart of the states that recognize same-sex marriages, and which of these states also recognize tenancy by the entireties (for creditor protection purposes), have state inheritance and estate taxes, and have state income tax imposed upon individual income.  The chart can be accessed by clicking here.

Many Florida estate planning lawyers and advisors will be structuring same-sex couples’ arrangements with the help of legal counsel in the state where our clients become domiciled.

We are hopeful that the Florida legislature will recognize this quandary and enable same-sex Floridians who have chosen to be married in other jurisdictions to be recognized as married for the purposes of Florida law.

We welcome any questions, comments and suggestions on this important issue.

What Your Clients Want to Know About James Gandolfini – A Look at his Last Will and Testament and What Was Wrong With It – A LISI Article by Bruce Steiner

 Bruce Steiner

            With the passing of actor James Gandolfini come some interesting reports regarding his estate.  There are a few lessons to be learned from Mr. Gandolfini’s Last Will and Testament including some very expensive ones for his family.

Bruce Steiner, an attorney with Kleinberg, Kaplan, Wolff & Cohen, P.C. in New York City wrote the attached article for LISI and can be reviewed by clicking here.

Bruce Steiner has over 35 years of experience in the areas of taxation, estate planning, business succession planning and estate and trust administration. He is a frequent lecturer at continuing education programs for bar associations, CPAs and other professionals. He is a commentator for Leimberg Information Services, Inc., is a member of the editorial advisory board of Trusts & Estates, is a technical advisor for Ed Slott’s IRA Advisor, and has written numerous articles for Estate Planning, BNA Tax Management’s Estates, Gifts & Trusts Journal,Trusts & Estates, the Journal of TaxationProbate & PropertyTAXES, the CPA Journal, the CLU Journal and other professional journals. Bruce has been quoted in various publications includingForbesThe New York TimesWall Street Journal, Daily Tax Report, Lawyers Weekly,Bloomberg’s Wealth ManagerFinancial PlanningKiplinger’s Retirement Report, Newsday, theNew York Post, the Naples Daily News, Individual Investor, TheStreet.com, and Dow Jones (formerly CBS) Market Watch. Bruce has served on the professional advisory boards of several major charitable organizations and was named a New York Super Lawyer in 2010, 2011 and 2012.  Mr. Steiner can be reached at 212-880-9818 or via email at bsteiner@kkwc.com

Ken Crotty’s LLC Clinic

            Each week Ken Crotty will be providing a discussion each week on aspects of the new LLC Act and how these will impact clients and practitioners.  This week he discusses the New LLC Act and when it goes into effect.

            Effective Date of the New LLC Act

Florida’s new LLC Act will be effective as of January 1, 2014, for any LLCs formed on or after January 1, 2014.  For LLCs formed on or before December 31, 2013, there is some flexibility.  The latest the Act will apply to these LLCs is on January 1, 2015, and members and managers of these LLCs will have until this date to modify the LLC’s governing documents to comply with the Act and to avoid unintended results.

LLC’s formed on or before December 31, 2013, may elect to have the Act apply to the LLC at anytime between January 1, 2014, and January 1, 2015.  It is important to note, however, that if the LLC elects to have the Act apply then the entire Act applies to the LLC.  It is not possible to pick and choose certain provisions of the Act and elect them to apply to the LLC.  The election is an all or nothing decision.  Because of this, members and managers of LLCs that are in existence on or before December 31, 2013, should review their governing documents to be certain that there will not be unintended consequences of electing to have the Act apply before January 1, 2015, and should modify their documents accordingly before the election to have the Act apply is made.

Registration is Now Open for the Notre Dame Tax & Estate Planning Institute in October

Professor Jerry Hesch’s Notre Dame Tax Institute will once again provide significant income tax planning technique coverage in addition to estate, estate tax, and related topics.  The Institute is held in South Bend, Indiana each fall. This year the dates are Wednesday, October 16 to Friday, October 18, 2013.

Alan Gassman will be working with Professor Hesch in preparing and presenting Interesting Interest Questions, Planning with Low Interest Loans, Self-Cancelling Installment Notes, Private Annuities, Defective Grantor Trusts, and Similar Issues That Arise in a Low Interest Rate Environment.

Other speakers and their topics include:

  • Maintaining and Obtaining Income Tax Basis, by Turney Berry, Louisville, KY
  • Planning with Portability: What Do the Numbers Show? by Diana S.C. Zeydel, Miami, FL
  • The Tax Apportionment Clause: Often the Most Important Provision in the Will, by Jonathan Blattmachr, New York, NY
  • Structuring Trustee Powers to Avoid a Tax Catastrophe (Or 20 Things You Need to Know About Selecting Trustees and Structuring Trustee Powers) by Steve Akers, Dallas, TX
  • Myths, Mysteries and Mistakes: Common Transfer Tax Concepts That Are Not Well-Known or Understood, by Professor Jerry Pennell, Atlanta, GA
  • Current Developments of Importance to Estate Planners, by Professor Jeffery Pennell, Atlanta, GA
  • Fiduciary’s Guide to Retirement Benefits, by Natalie B. Choate, Boston, MA
  • Evaluating Mistakes Made with Commonly-Used Techniques (The Screw-Ups) and Evaluating the Risks Associated with Certain Techniques, by David Handler, Chicago, IL and Professor David Herzig, Valparaiso, IN
  • Yours, Mine and Ours: Estate Planning for Couples in a Second Marriage, by Eric A. Manterfield, Indianapolis, IN
  • Prenuptial Agreements and Divorce: A Minefield Or A Solution? by Linda Ravdin, Washington, DC
  • Monitoring Trustees: When, Why and How to Use a Trust Protector, by Professor Larry Frolik, Pittsburgh, PA
  • Special Needs Planning: What Every Estate Planning Professional Needs to Know, by Bernard Krooks, New York, NY
  • The Bet Not to Live: Using Private Annuities and SCINs for Individuals Not Expected to Survive Their Life Expectancy, by Jerome Deener, Roseland, NJ
  • Evaluating Premium Financed Life Insurance, by Rebecca Ryan, Chicago, IL
  • The Dueling Transferors’ Problem: The Uncertain GST Tax Consequences and Planning Implications of Having A Beneficiary Assign an Interest in a Trust, by Austin Bramwell, New York, NY
  • Evaluating Private Placement Life Insurance in a High Investment Tax Environment, by Leslie Giordani, Austin, TX
  • Valuation of Large Companies: Blockage and Other Factors, Professor Ashok Abbot, Morgantown, WV
  • Avoid Being a Defendant: Estate Planning Malpractice and Ethical Concerns by Professor Gerry Beyer, Lubbock, TX
  • An Estate Planning Trilogy: Digital Assets, Guns and Pets, by Professor Gerry Beyer, Lubbock, TX
  • The Self-Management Structure: A Potent and New Age Solution to the Business Succession Planning Conundrum, by Avi Kestenbaum, Mineola, NY
  • Don’t End Up as Road Kill: Surviving Ethical Challenges in Transfers Between Family Members, by Charles “Skip” Fox, Charlottesville, VA
  • Converting Asset Protection to Asset Collection: A Creditor’s Perspective, by Melissa Langa, Boston, MA
  • It’s Yours If You Do As I Say: Conditional Gifts and In Terrorem Clauses, by Professor William LaPiana, New York, NY
  • Section 1411: Net Investment Income Tax, David Kirk, Washington, DC (invited)
  • Maintaining and Estate Planning Practice in the 21st Century in a $5 Million Exemption Era, Robert Romanoff, Chicago, IL
  • Using DINGs, NINGs, and Other Trusts to Reduce or Eliminate State Income Taxes, by Neil Schoenblum, Las Vegas, NV and Professor Jerry Schoenblum, Nashville, TN
  • Drafting Tips That Minimize The Federal Income Tax on Trusts, by James Blasé, St. Louis, MO
  • International Tax Planning: A Practical Approach, by Charles Schultz, Chicago, IL

To register for the Institute please click here and don’t forget to book your tickets to the Notre Dame vs. USC game on October 19.

Back by Popular Demand – Join us for our August 23, 2013 Presentation of the JEST Trust System as part of Phil’s Ultimate Estate Planner, including New Materials and Forms

Our first teleseminar with Phil’s Ultimate was widely received and we were asked to come back and present our materials again in a teleconference on Friday, August 23, 2013 at 12:00 p.m.

You can sign up for the teleconference with Phil’s Ultimate Estate Planner, which costs $139 (or $189 for printed materials and CD), by going to the website of Phil’s Ultimate Estate Planner, which can be viewed by clicking here.

Phil’s ultimate is also offering a special package.  The JEST Legal Document Form Package Plus Teleconference Participation (and CD) for a discounted rated of $395 (regularly $495).  The package contains the JEST legal document form package, teleconference participation, downloadable PDF materials, downloadable MP3 recording and a CD-ROM sent 5-7 days following the teleconference.

The JEST trust system permits a married couple living in Florida, or other non-community property states, to hold “joint assets” under one trust agreement that allows a clear step-up in basis and credit shelter trust funding from the share of the first dying spouse. The JEST trust system is also designed to facilitate using the share of the surviving spouse to fund a “capitalized credit shelter trust B” that we believe makes use of the remainder of the first dying spouse’s estate tax exemption using the same rational that the IRS has used for a technical advice memorandum and four private letter rulings, while also qualifying the assets from the surviving spouse for a step-up in basis, if our reasoning and the technique we have developed is correct.

The JEST trust and its assets will not qualify as tenancy by the entireties assets for creditor protection planning, and not all advisors will feel confident that the IRS will accept the intended treatment, but if our technique is accepted in the same manner as the technical advice memorandum and four private letter rulings then a full funding of a credit shelter trust and a full stepped up basis for joint trust property can be achieved. You cannot get what you do not ask for!

Lawyers in History: The Impact of Law Practice on their Lives and Careers: Aaron Burr

Burr with words

            On this day in 1804, Aaron Burr fatally shot his long-time political opponent, Alexander Hamilton in a duel.

Upon graduation from college at the young age of 17, Burr began to study law.  Upon hearing about the clashes with the British troops, Burr joined the Continental Army.  He served between the years 1775 and 1779 and had much success.  He saved an entire Brigade of men, including long-time friend, Alexander Hamilton, from capture by the British when they invaded Manhattan, but Burr never received a commendation for his actions.

Due to his declining health, he was forced to leave the Continental Army.  He then took up his study of law and was admitted to the New York Bar in 1782.  He practiced law in New York City and served in the New York State Assembly.  In 1789 he was appointed New York State Attorney General and in 1791 was elected a U.S. Senator.

In 1796 Burr ran for Vice President, only to come in fourth behind John Adams (elected President), Thomas Jefferson (elected Vice President) and Thomas Pinckney.  Upon his defeat he returned to the Senate and served until 1799.  During his time in the Senate he cooperated with Holland Land Company to obtain a law to permit aliens to hold and convey land.  During this time he became a key player in New York politics.

In 1799 he also founded the Bank of the Manhattan Company which later merged into Chase Manhattan Bank and eventually became JPMorgan Chase.  He did this under the auspices that he was forming a water company, which was needed in New York.  He commissioned the support of Alexander Hamilton and other Federalists.  Shortly after approval, Burr changed the charter to include banking knowing all along that a water company was not in his plans.  This was the start of Hamilton’s malevolence for Burr, calling his actions dishonest.

Because of his role in the political arena of New York, Burr was asked by Thomas Jefferson and James Madison to help them with the election of 1800.  He enlisted the help of social clubs to help Jefferson and Madison and through those actions, Burr is credited as being the father of modern political campaigning.

He was later placed on the ballot for the 1800 election and became Vice President under Thomas Jefferson, although Jefferson never trusted him and did not consult him on important matters.  Burr, however, as President of the Senate, was seen as even-handed and fair, especially during the impeachment trial of Justice Samuel Chase so Jefferson’s distrust of Burr was seen as unfounded.

Thomas Jefferson dropped Burr from his ticket in the 1804 election and Burr instead ran for Governor of New York state.  He lost that election to Morgan Lewis and blamed his loss on a personal smear campaign by prior Governor George Clinton, who believed that Burr entertained a Federalist succession movement in New York.  In April of the same year, the Albany Register, published a letter from Dr. Charles D. Cooper to Philip Schuyler, which relayed Alexander Hamilton’s judgment that Burr was “a dangerous man, and one who ought not to be trusted with the reins of government.”  Burr then sent a letter to his long-time friend, Alexander Hamilton asking for clarification.  Hamilton responded back that Burr should give specifics of Hamilton’s remarks and not Cooper’s.  The two exchanged several more letters escalating into Burr demanding that Hamilton retract any statement that would denigrate Burr’s honor over the past 15 years.  Hamilton refused and Burr challenged him to a duel, which had long been outlawed in New York state.  The two decided to hold their duel in New Jersey, even though it had been outlawed there as well.  The penalty for dueling in New York was death, whereas the penalty for dueling in New Jersey was less severe.

On July 11, 1804, Alexander Hamilton and Aaron Burr met outside of Weekhawken, New Jersey.  It is said that it was hard to figure out which gun was fired fist in the duel, as the shots were that close.  Alexander Hamilton missed his mark, blaming the sun and his placement in the duel.  Aaron Burr did not miss his mark.  He shot Hamilton in the stomach and Hamilton died the next day.  Burr was charged with multiple crimes including murder in both New York and New Jersey but he was never tried in either state.

In 1805 when his term as Vice President was over, Burr journeyed to the Western Frontier and met with General James Wilkinson, who was an agent for the Spanish.  It is said that during their meeting  Burr and Wilkinson had plotted to establish an independent nation.  To begin they wanted to seize territory from the Spanish in what is now Louisiana.  In the fall of 1806, Burr led a group of well-armed colonists toward New Orleans.  This move prompted an investigation by the government.  In an attempt to save himself, General Wilkinson turned on Burr and sent notice to Washington of what Burr was up to.  In February of 1807 Burr was arrested for treason.  He was tried in a U.S. circuit court in Virginia but was acquitted.

Although he was acquitted, he was seen as a traitor to his nation.  Burr fled to Europe for many years, before returning to New York and his law practice.

Although Burr was instrumental in the Revolutionary War, was an attorney, served many seats in the U.S. Government and was tried and acquitted for treason, he is perhaps best known for his duel with Alexander Hamilton.

 Duel with words

Applicable Federal Rates

Please click here to view a chart of this month’s, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale you can use the lowest of the 3.

Seminars and Webinars

  • BP OIL SPILL CLAIMS – AVOID MISTAKES AND MAXIMIZE CLAIMS

Date: Wednesday, July 17, 2013 | 5:00 p.m. – 5:30 p.m.

Presenters: John Goldsmith, Esq. and Alan S. Gassman

Location: Online webinar

Additional Information:  To register for this webinar please click here.[ https://www2.gotomeeting.com/register/209179266]

 

  • MEDICAL EDUCATION RESOURCES PRIMARY CARE CONFERENCE

 

Alan Gassman will be speaking on the topic of LEGAL, TAX AND FINANCIAL BOOT CAMP FOR THE MEDICAL PRACTICE – A SPECIAL TAX, ESTATE PLANNING AND LAW CONFERENCE FOR PRIMARY CARE PHYSICIANS

 

Date: July 19 – 21, 2013 (Friday – Sunday mornings; Have fun at Disney in the afternoons and we will not ask what you do at night!)

 

Topic:         1)             The 10 Biggest Mistakes That Physicians Make In Their Investments and Business Planning

9am – 10am on Friday, July 19, 2013

 

2)             Lawsuits 101

                                                10:10 am – 11:10 am on Friday, July 19, 2013

 

3)             Essential Estate Planning

                                                11:10 am – 11:40 am on Friday, July 19, 2013

 

4)             Asset Entity Planning for Creditor Protection and Buy Sell Arrangements

10:10 am – 11:10 am on Saturday, July 20, 2013

 

                    5)             50 Ways to Leave Your Overhead – How to Enhance Medical Practice Profitability

11:40 am – 12:40 pm on Saturday, July 20, 2013

 

                    6)             Stark Naked, or Well Prepared? – Health Law Compliance

9:00 am – 10:00 am on Sunday, July 21, 2013

 

Location: Disney’s Boardwalk Resort, Orlando, Florida

 

Topics by Other Speakers: 2013 Tax Changes, Tax Deductions for Physicians, Medical Practice Financial Management, Physician Compensation, Tax Structures for Medical Practices and Retirement Plan Options for Physicians.

 

Additional Information:  For more information please visit www.MER.org  Please note that the program qualifies for continuing education credit for physicians.

 

  • THE JOINT EXEMPT STEP-UP TRUST (JEST)

Date: Friday, August 23, 2013 | 12pm Eastern/9am Pacific

Sponsor: The Ultimate Estate Planner, Inc.

Additional Information:  If you would like to attend this teleconference please click here to register [http://ultimateestateplanner.com/lawyer/Teleconference_Registration_cp8532.htm]

  • AVOIDING THE TRAPS IN EMR/TECH CONTRACTS….NOW YOU TELL ME I’M STUCK WITH THIS FOR 5 YEARS!

 

Date: Tuesday, September 10, 2013 | 5:00 p.m and Thursday, September 12, 2013 | 12:30 p.m. (Each webinar will last 30 minutes)

 

Presenter: Sandra Greenblatt, Board Certified Health Lawyer

 

Location: Online webinar.

 

Additional Information: To register for the Tuesday, September 10, 2013, 5pm webinar please click here [ https://www2.gotomeeting.com/register/878841962] .  To register for the Thursday, September 12, 2013, 12:30 p.m. webinar please click here [https://www2.gotomeeting.com/register/706396738]

 

  • WEDU ESTATE PLANNING SEMINAR

 

Gassman Law Associates meets Big Bird – Sesame Street vs. Wall Street?

 

Alan Gassman will be speaking on the topic of ASSET PROTECTION – ESSENTIAL KNOWLEDGE AND HOT TOPICS

 

Leading trust law expert Bruce Stone, Esq. will also speak on a topic to be determined.

 

Date: Thursday, September 19, 2013 | 7:30 am – 11:30 am

 

Location: TBD

 

Additional Information:  If you would like to sign up for this seminar please email agassman@gassmanpa.com

 

  • NOTRE DAME TAX & ESTATE PLANNING INSTITUTE

 

Jerry Hesch and Alan Gassman will be speaking on the topics of INTERESTING INTEREST QUESTIONS AND PLANNING WITH LOW INTEREST LOANS, PRIVATE ANNUITIES, DEFECTIVE GRANTOR TRUSTS, AND PRIVATE AND COMMERCIAL ANNUITIES

 

Date: Wednesday, October 16 through Friday, October 18, 2013

 

Location: Notre Dame College, South Bend, Indiana

 

Additional Information: Professor Jerry Hesch’s Notre Dame Tax Institute will once again emphasize the importance of income tax planning and implications in addition to estate, estate tax, and related concepts.   To register for the Institute please click here [http://law.nd.edu/alumni/continuing-legal-education/] and don’t forget to get your football tickets to the Notre Dame-USC game on October 19.

We welcome questions, comments and suggestions for the presentation that we are assisting Jerry in preparing and presenting.

 

  • PINELLAS COUNTY ESTATE PLANNING COUNCIL CONFERENCE

 

Alan Gassman will be speaking on the topic of HOT TOPICS FOR ESTATE PLANNERS

 

Date: Wednesday, October 23, 2013 | 8:00 am – 12:00 p.m. (60 MINUTE PRESENTATION)

 

Location: TBD

 

Additional Information: To attend the meeting or to receive information on joining the Council please click here [http://www.pinellascountyepc.org/displayevent.web?EventID=7141] or email agassman@gassmanpa.com

 

  • 2013 MOTE VASCULAR SURGERY FELLOWS – FACTS OF LIFE TALK SEMINAR FOR FIRST YEAR SURGEONS

 

Alan Gassman will be speaking on the topic of ESTATE, MEDICAL PRACTICE, RETIREMENT, TAX, INSURANCE, AND BUY/SELL PLANNING – THE EARLIER YOU START PLANNING THE SOONER YOU WILL BE SECURE

 

Date: October 25 – 27, 2013 | Times TBD

 

Location: TBD

 

Additional Information: Please contact agassman@gassmanpa.com for additional information.

 

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE) HEALTH LAW SYMPOSIUM – AN ALL DAY SEMINAR

 

Alan Gassman will be speaking on the topic of WHAT HEALTH LAWYERS NEED TO KNOW ABOUT FLORIDA LAW

 

Date: Friday, November 1, 2013 | 9am – 5pm (Mr. Gassman speaks from 1:10 pm until 2:10 p.m.)

 

Location: Seton Hall Law School, Newark, New Jersey

 

Additional Information: Seton Hall University in South Orange, New Jersey was founded in 1856, and they have remodeled since.  Today, Seton Hall has over 10,000 students in its undergraduate, graduate and law school programs and is in close proximity to several Kentucky Fried Chicken locations.

 

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE)_SPECIAL 3 HOUR SESSION

 

Alan Gassman will be speaking on the topic of WHAT NEW JERSEY LAWYERS NEED TO KNOW ABOUT FLORIDA LAW – A 3 HOUR OVERVIEW BY ALAN S. GASSMAN

 

Date: Saturday, November 2, 2013

 

Location: Wilshire Grand Hotel, West Orange, New Jersey | 9am – 12pm

 

Additional Information: Please tell all of your friends, neighbors and enemies in New Jersey to come out to support this important presentation for the New Jersey Bar Association.  We will include discussions of airboats, how to get an alligator off of your driveway, how to peel a navel orange and what collard greens and grits are. For additional information please email agassman@gassmanpa.com

 

  • SALT LAKE CITY ESTATE PLANNING COUNCIL’S FALL ONE DAY “TAX AND DEDUCTIBILITY OF YOUR SKI TRIP” INSTITUTE

 

Alan Gassman will be speaking on the topic of PRACTICAL ESTATE PLANNING, WITH A $5.25 MILLION EXEMPTION AMOUNT

 

Date: Thursday, November 7, 2013

 

Location: Hilton Downtown Salt Lake City, Utah

 

Additional Information:  Please support this one day annual seminar conveniently located near skiing and tourism opportunities.  If you would like to attend this event or receive the materials please email agassman@gassmanpa.com

 

NOTABLE CONFERENCES PRESENTED BY OTHERS:

 

  • 48th ANNUAL HECKERLING INSTITUTE ON ESTATE PLANNING SEMINAR

 

Date: January 13 – 17, 2014

 

Location:  Orlando World Center Marriott, Orlando, Florida

 

Sponsor: University of Miami School of Law

 

Additional Information: For more information please visit: http://www.law.miami.edu/heckerling/

 

  • 16th ANNUAL ALL CHILDREN’S HOSPITAL ESTATE, TAX, LEGAL & FINANCIAL PLANNING SEMINAR

 

Date: Wednesday, February 12, 2014

 

Location: All Children’s Hospital Education and Conference Center, St. Petersburg, Florida with remote location live interactive viewings in Tampa, Sarasota, New Port Richey, Lakeland, and Bangkok, Thailand

 

Sponsor: All Children’s Hospital

 

  • THE UNIVERSITY OF FLORIDA TAX INSTITUTE

 

Date: February 19 – 21, 2014

 

Location: Grand Hyatt, Tampa, Florida

 

Sponsor:  UF Law alumni and UF Graduate Tax Program

 

Additional Information:  Here is what UF is saying about the program on its website: “The UF Tax Institute will provide tax practitioners and other leading tax, business and estate planning professionals with a program that covers the most current issues and planning ideas with a practical, informative, state-of-the-art approach.  The Institute’s schedule will devote separate days or half days to individual income tax issues, entity tax issues and estate planning issues.  Speakers and presentations will be announced as the program date nears to ensure coverage of the most timely and significant topics.  UF Law alumni have formed the Florida Tax Education Foundation, Inc., a nonprofit corporation, to organize the conference.”

 

For details about each event, please visit us online at gassmanlawassociates.com/newsandevents.html

Thank you to our law clerks that assisted us in preparing this report.

The Thursday Report – Special July 4th Edition

Posted on: July 3rd, 2013

No Comments

A Special Independence Day Edition!

Let’s make this the best fourth of July ever, ever, ever, ever!

- Kentucky Fried Movie

Flag_with_Fireworks_Wallpaper__yvt2

 

In honor of Independence Day the Thursday Report is taking a break and providing you with this short but sweet (like KFC coleslaw) version.

We wish all Thursday Report readers and their families a very happy and safe Independence Day!

Some Quotes About Independence Day

I only regret that I have but one life to lose for my country.

- Nathan Hale

The Constitution only gives people the right to pursue happiness. You have to catch it yourself.

- Benjamin Franklin

Is life so dear or peace so sweet as to be purchased at the price of chains and slavery? Forbid it, Almighty God! I know not what course others may take, but as for me, give me liberty, or give me death!

- Patrick Henry

 This nation will remain the land of the free only so long as it is the home of the brave.

-        Elmer Davis

 This, then, is the state of the union:  free and restless, growing and full of hope.  So it was in the beginning.  So it shall always be, while God is willing, and we are strong enough to keep the faith.

-        Lyndon B. Johnson

 It is by the goodness of God that in our country we have those three unspeakably precious things: freedom of speech, freedom of conscience, and the prudence never to practice either of them.

-        Mark Twain

Our thoughts and prayers are with the families of the 19 firefighters killed in Arizona this week.

But sound aloud the praises, and give the victor-crown
To our noble-hearted Firemen, who fear not danger’s frown.
~Frederic G.W. Fenn, “Ode to our Firemen,” 1878

All men are created equal, then a few become firemen.  ~Author Unknown

Firemen never die, they just burn forever in the hearts of the people whose lives they saved.  ~Susan Diane Murphree

So as you look at the firefighter with his rake, hose or axe,
His beet red face or ice covered mustache,
You should know why he goes through that smoky front door,
And is forced to crawl like a baby down on the floor.
He does it to save both lives and property,
All that is precious to you and to me.
So take a good look at this modern warrior who serves his call proud and true,
And know that he would die just to save me and you.
~Robert J. Athans

You have to do something in your life that is honorable and not cowardly if you are to live in peace with yourself, and for the firefighter it is fire.  ~Larry Brown

            If you would like to do some reading this weekend our coverage so far this year on the new Florida statutes that were passed is as follows:

DID YOU KNOW….

As we celebrate the birth of our nation today, have you ever given thought to what happened to all of the people who signed the Declaration of Independence on July 4, 1776?

56 freedom fighters signed the Declaration of Independence and only a few of them are well known for their roles in America’s history, but what happened to the rest of them?

There were 24 lawyers in the group, 9 farmers, 11 merchants and several other well educated men who knew that by putting pen to paper and signing their names that they would face certain death if they were captured.  Five of the 56 were captured, tortured and killed.  12 had their homes destroyed, all in the face of freedom.  Two even had sons killed in the Revolutionary War.

One of the signers, Thomas McKeam, was so constantly pursued by British Soldiers that he had to move his family from place to place.  He also served in the Congress without pay while his family was kept in hiding.

British General Cornwallis took over one of the signers, Thomas Nelson, Jr.’s home for his headquarters during the Revolution.  While fighting the war, Thomas Nelson urged then General George Washington to open fire on his home.  General Washington did and in the process destroyed Mr. Nelson’s home.

Francis Lewis’ wife was jailed and died within a few months and his home and property were destroyed.  John Hart was driven from his wife’s bedside while she was dying and his 13 children were forced to flee.  He lived in the forest for over a year and when he returned home he found that his wife had died and his children were gone.  Additionally, his land had been destroyed.  He died a few weeks later, some say from a broken heart.

Of course we know the fate of those few famous signers like John Hancock, Benjamin Franklin, Thomas Jefferson and John Adams, but let us not forget both the famous and ordinary people who risked their lives for the freedom and country we enjoy today!

Applicable Federal Rates

Please click here to view a chart of this month’s, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale you can use the lowest of the 3.

Seminars and Webinars

FLORIDA HEALTH CARE LAW CHANGES: HOW THEY AFFECT PHYSICIANS AND MEDICAL ENTERPRISES WEBINAR

Date:  Wednesday, July 10, 2013 | 5:00 p.m. – 5:30 p.m. (30 Minute Webinar)

Speakers: Healthcare Expert Lester Perling, J.D., M.H.A. and Alan S. Gassman, J.D., LL.M.

Location: Online webinar.

Additional Information: To register for the webinar please click here.

ESTATE TREK: DEEP SPACE NINE – EVEN MORE UPDATES TO OUR ESTATE PLANNING SOFTWARE

Date: Tuesday, July 16, 2013 | 12:30 p.m. – 1:00 p.m. (30 Minute Webinar)

Speakers: Alan S. Gassman, Kenneth J. Crotty and Christopher J. Denicolo

Location: Online webinar

Additional Information: To register for this webinar please click here.

BP OIL SPILL CLAIMS – AVOID MISTAKES AND MAXIMIZE CLAIMS

Date: Wednesday, July 17, 2013 | 5:00 p.m. – 5:30 p.m. (30 Minute Webinar)

Speakers: John Goldsmith, Esq. and Alan S. Gassman

Location: Online webinar

Additional Information:  To register for this webinar please click here.

MEDICAL EDUCATION RESOURCES PRIMARY CARE CONFERENCE

Alan Gassman will be speaking on the topic of LEGAL, TAX AND FINANCIAL BOOT CAMP FOR THE MEDICAL PRACTICE – A SPECIAL TAX, ESTATE PLANNING AND LAW CONFERENCE FOR PRIMARY CARE PHYSICIANS

Date: July 19 – 21, 2013 (Friday – Sunday mornings; Have fun at Disney in the afternoons and we will not ask what you do at night!)

Topic:         1)             The 10 Biggest Mistakes That Physicians Make In Their Investments and Business Planning

9am – 10am on Friday, July 19, 2013

2)             Lawsuits 101

                                                10:10 am – 11:10 am on Friday, July 19, 2013

3)             Essential Estate Planning

                                                11:10 am – 11:40 am on Friday, July 19, 2013

4)             Asset Entity Planning for Creditor Protection and Buy Sell Arrangements

10:10 am – 11:10 am on Saturday, July 20, 2013

                    5)             50 Ways to Leave Your Overhead – How to Enhance Medical Practice Profitability

11:40 am – 12:40 pm on Saturday, July 20, 2013

                    6)             Stark Naked, or Well Prepared? – Health Law Compliance

9:00 am – 10:00 am on Sunday, July 21, 2013

Location: Disney’s Boardwalk Resort, Orlando, Florida

Topics by Other Speakers: 2013 Tax Changes, Tax Deductions for Physicians, Medical Practice Financial Management, Physician Compensation, Tax Structures for Medical Practices and Retirement Plan Options for Physicians.

Additional Information:  For more information please visit www.MER.org  Please note that the program qualifies for continuing education credit for physicians.

AVOIDING THE TRAPS IN EMR/TECH CONTRACTS….NOW YOU TELL ME I’M STUCK WITH THIS FOR 5 YEARS!

Date: Tuesday, September 10, 2013 | 5:00 p.m and Thursday, September 12, 2013 | 12:30 p.m. (Each webinar will last 30 minutes)

Speaker: Sandra Greenblatt, Esq.

Location: Online webinar.

Additional Information: To register for the Tuesday, September 10, 2013, 5pm webinar please click here.  To register for the Thursday, September 12, 2013, 12:30 p.m. webinar please click here.

WEDU ESTATE PLANNING SEMINAR

Gassman Law Associates meets Big Bird – Sesame Street vs. Wall Street?

Alan Gassman will be speaking on the topic of ASSET PROTECTION – ESSENTIAL KNOWLEDGE AND HOT TOPICS

Leading trust law expert Bruce Stone, Esq. will also speak on a topic to be determined.

Date: Thursday, September 19, 2013 | 7:30 am – 11:30 am

Location: TBD

Additional Information:  If you would like to sign up for this seminar please email agassman@gassmanpa.com

NOTRE DAME TAX INSTITUTE

Jerry Hesch and Alan Gassman will be speaking on the topic of INTERESTING INTEREST QUESTIONS, PLANNING WITH LOW INTEREST LOANS, PRIVATE ANNUITIES, DEFECTIVE GRANTOR TRUSTS, AND PRIVATE AND COMMERCIAL ANNUITIES

Date: Wednesday, October 16 through Friday, October 18, 2013

Location: Notre Dame College, South Bend, Indiana

Additional Information: Professor Jerry Hesch’s Notre Dame Tax Institute will once again emphasize the importance of income tax planning and implications in addition to estate, estate tax, and related concepts.

Email us now to get your football tickets to the Notre Dame-USC game on October 19.

We welcome questions, comments and suggestions for the presentation that we are assisting Jerry in preparing and presenting.

PINELLAS COUNTY ESTATE PLANNING COUNCIL SEMINAR

Alan Gassman will be speaking on the topic of HOT TOPICS FOR ESTATE PLANNERS

Date: Wednesday, October 23, 2013 | 8:00 am – 12:00 p.m. (60 MINUTE PRESENTATION)

Location: TBD

Additional Information: To attend the meeting or to receive information on joining the Council please click here or email agassman@gassmanpa.com

2013 MOTE VASCULAR SURGERY FELLOWS – FACTS OF LIFE TALK SEMINAR FOR FIRST YEAR SURGEONS

Alan Gassman will be speaking on the topic of ESTATE, MEDICAL PRACTICE, RETIREMENT, TAX, INSURANCE, AND BUY/SELL PLANNING – THE EARLIER YOU START THE SOONER YOU WILL BE SECURE

Date: October 25 – 27, 2013 | Times TBD

Location: TBD

Additional Information: Please contact agassman@gassmanpa.com for additional information.

NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE) HEALTH LAW SYMPOSIUM – AN ALL DAY SEMINAR

Alan Gassman will be speaking on the topic of WHAT HEALTH LAWYERS NEED TO KNOW ABOUT FLORIDA LAW

Date: Friday, November 1, 2013 | 9am – 5pm (Mr. Gassman speaks from 1:10 pm until 2:10 p.m.)

Location: Seton Hall Law School, Newark, New Jersey

Additional Information: Seton Hall University in South Orange, New Jersey was founded in 1856, and they have remodeled since.  Today, Seton Hall has over 10,000 students in its undergraduate, graduate and law school programs and is in close proximity to several Kentucky Fried Chicken locations.

NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE)_SPECIAL 3 HOUR SESSION

Alan Gassman will be speaking on the topic of WHAT NEW JERSEY LAWYERS NEED TO KNOW ABOUT FLORIDA LAW – A 3 HOUR OVERVIEW BY ALAN S. GASSMAN

Date: Saturday, November 2, 2013

Location: Wilshire Grand Hotel, West Orange, New Jersey | 9am – 12pm

Additional Information: Please tell all of your friends, neighbors and enemies in New Jersey to come out to support this important presentation for the New Jersey Bar Association.  We will include discussions of airboats, how to get an alligator off of your driveway, how to peel a navel orange and what collard greens and grits are. For additional information please email agassman@gassmanpa.com

SALT LAKE CITY ESTATE PLANNING COUNCIL’S FALL ONE DAY “TAX AND DEDUCTIBILITY OF YOUR SKI TRIP” INSTITUTE

Alan Gassman will be speaking on the topic of PRACTICAL ESTATE PLANNING, WITH A $5.25 MILLION EXEMPTION AMOUNT

Date: Thursday, November 7, 2013

Location: Hilton Downtown Salt Lake City, Utah

Additional Information:  Please support this one day annual seminar conveniently located near skiing and tourism opportunities.  If you would like to attend this event or receive the materials please email agassman@gassmanpa.com

NOTABLE SEMINARS PRESENTED BY OTHERS:

48th ANNUAL HECKERLING INSTITUTE ON ESTATE PLANNING SEMINAR

Date: January 13 – 17, 2014

Location:  Orlando World Center Marriott, Orlando, Florida

Sponsor: University of Miami School of Law

Additional Information: For more information please visit: http://www.law.miami.edu/heckerling/

16th ANNUAL ALL CHILDREN’S HOSPITAL ESTATE, TAX, LEGAL & FINANCIAL PLANNING SEMINAR

Date: Wednesday, February 12, 2014

Location: All Children’s Hospital Education and Conference Center, St. Petersburg, Florida with remote location live interactive viewings in Tampa, Sarasota, New Port Richey, Lakeland, and Bangkok, Thailand

Sponsor: All Children’s Hospital

THE UNIVERSITY OF FLORIDA TAX INSTITUTE

Date: February 19 – 21, 2014

Location: Grand Hyatt, Tampa, Florida

Sponsor:  UF Law alumni and UF Graduate Tax Program

Additional Information:  Here is what UF is saying about the program on its website: “The UF Tax Institute will provide tax practitioners and other leading tax, business and estate planning professionals with a program that covers the most current issues and planning ideas with a practical, informative, state-of-the-art approach.  The Institute’s schedule will devote separate days or half days to individual income tax issues, entity tax issues and estate planning issues.  Speakers and presentations will be announced as the program date nears to ensure coverage of the most timely and significant topics.  UF Law alumni have formed the Florida Tax Education Foundation, Inc., a nonprofit corporation, to organize the conference.”

For details about each event, please visit us online at gassmanlawassociates.com/newsandevents.html

Thank you to our law clerks that assisted us in preparing this report.

The Thursday Report – June 27, 2013 – Text Law, Cole Slaw, Tax and Medical Law

Posted on: June 27th, 2013

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Even More New Florida Laws

Florida False Claims Act

Drug Database for Controlled Substances Only Used by 1/3 Pharmacists and 10% of Doctors in Florida

The New Texting Law And Making Sure Your Employees Are Not Risking Life And Liability By Texting On The Job

State by State Tenancy by the Entireties

Lawyers in History: The Impact of Law Practice on Their Lives and Careers – Potter Stewart

KFC CEO for Japan Buys Colonel Sanders White Suit

We welcome contributions for future Thursday Report topics. If you are interested in making a contribution as a guest writer, please email Janine Ruggiero at Janine@gassmanpa.com.

This report and other Thusday Reports can be found on our website at www.gassmanlawassociates.com.

Even More New Florida Laws

Florida’s estate tax was completely shut down in 2004 when the federal estate tax system stopped giving a credit for state estate taxes paid.   Nevertheless, Florida did not change its reporting laws until this year, so personal representatives of estates of Florida decedents have been having to file an Affidavit of No Florida Estate Tax Due with the State of Florida to confirm that there is no estate tax, regardless of whether the estate is required to file a Form 706 or 706NA Federal Estate Tax Return. This is as dumb as ordering mashed potatoes without that great Kentucky Fried Chicken no cholesterol or calories gravy.  Florida Statute Section 198.13 becomes effective July 1, 2013 to remove the requirement that personal representatives of the state of Florida decedents must file an Affidavit of No Florida Estate Tax Due, for decedents dying after January 1, 2013.

Florida False Claims Act

The new Florida False Claims Act (FFCA), which was signed by the governor on June 3, 2013, expands on the government’s powers under the existing Act.  In revising the Act, the legislature acts to conform the new FFCA to the Federal False Claims Act.  It will take effect July 1, 2013.

The FFCA allows for civil actions by either a private party or the state against a defendant who has defrauded the state.  Most claims pursued under the FFCA are for instances of health care, nursing home, Medicaid, and Medicare fraud.  Claims under the FFCA would include:

  • Submitting a false claim for payment or approval;
  • Making or using a false record to get a false or fraudulent claim paid or approved;
  • Conspiring to make a false claim or to deceive an agency to get a false or fraudulent claim allowed or paid; or
  • Making or using a false record to conceal, avoid, or decrease payments owed to the state government.

The penalty for violation of FFCA is between $5,500 to $11,000 per claim.  In addition, the state is awarded three times the amount of damage, which means, if a defendant defrauded the state of $100,000, the award to the state would be $300,000 in addition to the above penalty.  There is a lot of incentive for a private person to bring a claim: a private person will be awarded by a portion of the award in a successful action, in addition to any expenses to bring the claim.

Other penalties have been added to the Act, including a minimum of $5,000 for using false information to make a claim, and a civil penalty of up to $100,000 for a natural person or $1 million for any other entity, plus fees and costs, if evidence is either created or destroyed when there is an outstanding subpoena.

Speaking of subpoenas, that power has been expanded.  The Department of Legal Affairs now has discovery capabilities, even before civil proceedings are initiated.  Subpoenas can now be issued for production, interrogatories under oath and to give sworn testimony.  But that’s not all.  Now the Department of Legal Affairs is the only entity that can pursue under the FFCA, except for initiations or interventions by the Department of Financial Services.  The department can dismiss an action at any point, pursue a claim through an administrative remedy, and amend pleadings, or even file a new complaint, if it intervenes in an existing action.  In addition, the Attorney General’s Office’s authority has expanded with the power to prosecute claims that other governmental officials have not acted upon.

The burden of proof has been revised to prevent a defendant in a qui tam action from denying facts which were the “basis of a criminal proceeding in which the defendant was found guilty, pled guilty, or pled nolo contendere.”

A qui tam action is simply an action brought by a private person under the statute.  It is what allows the private person to sue for a penalty, which is partly received by either the government, or a specified public institution.  The other part is received by the private party to go buy more Kentucky Fried Chicken.

Drug Database For Controlled Substances Only Used by 1/3 Pharmacists and 10% of Doctors in Florida

Bills to require doctors to check the Florida E-FORCSE database failed this year, and we were surprised to learn that apparently less than 10% of Florida physicians are making use of this great program.  The Florida Legislature did approve $500,000 to keep a prescription drug database running, but is not requiring physicians or pharmacists to use it.  The Electronic – Florida Online Reporting of Controlled Substances Evaluation (E-FORCSE) was developed in 2010 to allow pharmacists and physicians to track prescriptions of controlled substances of patients.  However, the database is voluntary.  WUSF reports that Federal Officials told the Florida Board of Pharmacy, that only 1/3 of Florida pharmacists and 10% of Florida doctors are actually using the database.

Mandatory requirements for reporting (HB 831), and checking (SB 1192) the database were introduced in the Legislature, but both bills died in the House.  While the information in the database is not discoverable or admissible in any civil action, law enforcement officers are able to obtain reports directly through a manager of the database.  The executive vice president of the Florida Pharmacy Association told WUSF, that while pharmacists support the bill, they do not want to be forced to use it, and should be able to use their professional judgment.  There are plans to improve the database, and a panel is discussing mandatory requirements.

The New Texting Law And Making Sure Your Employees Are Not Risking Life And Liability By Texting On The Job

Are your employees or your client’s employees risking their lives and the lives of others by texting while driving on business?

The new Florida Statute Section § 316.305 ban on texting can be brought to their attention, and you can further enumerate the functions that are allowed under the Statute, but are still not safe.

The above-referenced Statutes can be found by clicking here.

The following is our Employee Texting Agreement, with an enumeration of seven cell phone functions that are permitted under Florida Statute § 812.15, not considered safe by many experts.  Please read below and let us know if you agree.  Student drivers and others who may drive your car or the cars of others might also be asked to sign such an agreement.  Read this agreement and think about the life and safety of those who are impacted by what you and others do while driving.  This is very serious stuff!

This will acknowledge that I, as an employee of GASSMAN LAW ASSOCIATES, P.A., can lose my job immediately if I am using a company car of GASSMAN LAW ASSOCIATES, P.A. and/or running an errand for GASSMAN LAW ASSOCIATES, P.A. and fail to follow Florida Statute §316.305 Florida Ban on Texting While Driving Law.  I understand that under this act, I may not:

operate a motor vehicle while manually typing or entering multiple letters, numbers, symbols, or other characters into a wireless communications device or while sending or reading data in such a device for the purpose of nonvoice interpersonal communication, including, but not limited to, communication methods known as texting, e-mailing, and instant messaging.

I further understand that “wireless communications device” means:

Any handheld device, used or capable of being used in a handheld manner, that is designed or intended to receive or transmit text or character-based messages, access or store data, or connect to the Internet or any communications services as defined in s. 812.15 and that allows text communications.

I understand that the following are to some extent permitted by Florida Statute §316.305, but are not permitted by GASSMAN LAW ASSOCIATES, P.A. and will be grounds for immediate termination if I engage in one or more of these activities while operating a company car of GASSMAN LAW ASSOCIATES, P.A. and/or running an errand for GASSMAN LAW ASSOCIATES, P.A.:

  1. Reading text messages, e-mails, instant messages, or any other data while operating a motor vehicle belonging to GASSMAN LAW ASSOCIATES, P.A. and/or running an errand for GASSMAN LAW ASSOCIATES, P.A.
  2. Conducting wireless interpersonal communication other than normal cell business related talking, that does not require text messages, such as voice-texting.
  3. Using a device or system for navigation purposes, such as a GPS.  An employee operating a motor vehicle belonging to GASSMAN LAW ASSOCIATES, P.A. and/or running an errand for GASSMAN LAW ASSOCIATES, P.A. requiring use of a GPS-type service must enter navigation instructions prior to departing.  Furthermore, the employee must pull off the road to a safe location to make changes or to interact with the device beyond listening to vocal instructions.
  4. Checking any weather or traffic alerts.  If the situation requires checking such alert or to get such information, the employee must pull off the road to a safe location to make changes or to interact with the device.
  5. Receiving messages that are related to the operation or navigation of the motor vehicle, or data used primarily by the motor vehicle.
  6. Using a hand-held device when stopped at a red light, or in traffic, except to view messages and e-mails, but not to send any or to be distracted from being vigilant and safe and aware of what is happening on the road.
  7. Using a hand-held device to listen to the radio, or play music while operating the vehicle.  Use the car radio instead, and no headphones!

I further agree not to use alcohol or any other “mood modifier” non-prescription medications or to have any such alcohol or medications in my bloodstream or lungs while I am driving.

I further agree to report any violation of the above by any other employee of GASSMAN LAW ASSOCIATES, P.A.

I understand that this agreement may be modified by GASSMAN LAW ASSOCIATES, P.A.

Printed Name: ______________________________

Signed: ___________________________________

Date: _____________________________________

State by State Tenancy by the Entireties

            We recently compiled and updated the following list of the tenancy by the entireties states, which denotes limitations where special characteristics are associated therewith.  Not all states have tenancy by the entireties, and many that do will not have protection of assets other than real estate, or have limited protection when it does apply.  Florida, Delaware and Wyoming are some of the states that offer what we call “Pure Protection”, but please keep in mind that if one spouse dies, or there is a divorce, or both spouses are sued then the TBE assets are exposed.  Our friend Phil Rarick of the Rarick, Beskin & Garcia Vega law firm in Miami Lakes, Florida recently sent his contact base the following excellent write up on this:

Tenancy by Entireties in Florida: The Benefits – and Five Traps

By Phillip B. Rarick, Miami Probate Attorney

Holding title to bank accounts, stock or other intangible property as Tenancy by Entireties or “TBE” is a limited but popular form of asset protection that has benefits – and traps.

Benefits of Holding Property as Tenants by Entireties

Holding property as TBE has certain benefits for married couples. Upon the death of one spouse, all assets flow to the surviving spouse without the need for probate. Holding property as TBE has significant asset protection benefits:  such property cannot be reached by creditors unless both husband and wife are liable.  If the property is held as TBE, and the creditor has a judgment against only one spouse, then the creditor cannot attack the TBE property.

Five Traps for Holding Property as Tenants by Entireties

1.       You must be married.  This form of ownership is available only to two persons in a legally recognized marriage.  TBE is therefore not available to a gay or lesbian couple in Florida.   Since Florida does not recognize common law marriage, TBE is not available to two persons living together regardless of the time of the relationship.

2.       Assets held jointly before marriage.   These assets do not automatically become TBE upon marriage.  Such assets should be re-transferred from the spouses jointly to themselves as tenants by entireties after the marriage.

3.       TBE assets can be attacked if both spouses are liable.  As mentioned above, if a creditor has a judgment against both spouses, then the creditor can reach TBE property.   Further, if one spouse dies, the TBE protection is lost, and the surviving spouse’s assets can be reached by creditors.

4.       Creating the account.  If one spouse is the owner of a bank account, do not just add the other spouse’s name to the account.  Open up a new account in joint names of the two spouses.

5.       Check your bank signature card.  If you and your spouse open a bank account at the same time, Florida law provides a legal presumption that the account is held as tenants by the entireties.  However, if the bank officer checked a box on the card  indicating contrary title when opening the account, such as “Joint Tenants With Right of Survivorship”, then the account will be held as indicated on the card.  The take-away point here is this:  check your bank signature cards for all accounts held in joint names with your spouse.

Conclusion

Tenancy by the entireties ownership can be a useful form of ownership in Florida.  However, there are numerous traps.  There are stronger and safer forms for asset protection that are available in Florida with proper planning.  In order to best protect your hard earned wealth, it is advisable to periodically review how you hold title to all your assets by a Florida attorney experienced in estate and asset protection planning.

For a copy of our chapter on TBE in our book entitled Gassman & Markham on Florida and Federal Asset Protection Law you can click here, and if you would like to purchase the book you can email Janine@gassmanpa.com or visit www.haddonhallpublishing.com

A chart that we have prepared on this topic is as follows:

STATE

LAW

PURE PROTECTION

Alaska

Recording a judgment against a judgment debtor, thus creating a judgment lien against property owned by the judgment debtor, does not sever a tenancy by the entirety between the judgment debtor and spouse. Smith v. Kofstad, 206 P.3d 441 (Alaska 2009)

No

Arkansas

Real property owned by the husband and wife as tenants by the entirety may be sold under execution to satisfy a judgment against the husband, subject to the wife’s right of survivorship. Morris v. Solesbee, 892 S.W. 2d 281 (1995).

No

Delaware

Creditors of a spouse have no interest in realty that is held by the entireties. Johnson v. Smith, 1994 WL 643131 (Del. Ch. 1994)

Pure Protection

D.C.

Although tenancy by the entireties property is liable for the spouses’ joint debts and for the individual debts of the surviving co-tenant, it is unreachable by the creditors of one tenant.  Morrison v. Potter, 764 A.2d 234 (D.C. 2000).

Pure Protection

Florida

Property is subject only to the debts of both spouses. In re Matthews, 360 B.R. 732 (Bankr. M.D. Fla. 2007).

Pure Protection

Hawaii

An estate by the entireties is not subject to the claims of the spouse’s individual creditors during the joint lives of the spouses. Sawada v. Endo, 561 P.2d 1291 (1977).

Pure Protection

Illinois

TBE in real property is available for homestead property only.  Premier Property Management, Inc. v. Jose Chavez, 728 N.E. 2d 476 (2000).

No

Indiana

Generally, the creditor of one spouse may not seize, sell or attach entirety property. Anuszkiewicz v. Anuszkiewicz 360 N.E. 2d 230, 232 (Ind. App. 1977).

Pure Protection

Kentucky

A creditor cannot force a sale of property owned by husband and wife as tenants by the entirety with right of survivorship, but the debtor spouse’s expectant interest can be sold. Coleman American Companies, Inc. v. Leasure, 2008 WL 5191463 (2008).

No

Maryland

Because entireties property is owned by the husband and wife as the marital unit, it is not subject to the claims of individual creditors of either spouse. Schlossberg v. Barney, 380 F.3d 174, 178 (4th Cir. 2004).

Pure Protection

Massachusetts

The property is protected from creditors of the debtor spouse, so long as the nondebtor spouse lives in the house. Coraccio v. Lowell Five Cents Sav. Bank, 612 N.E. 2d 650, 654 (1993).  If the nondebtor spouse no longer occupies the residence, it is subject to the execution for the debts of the other spouse. In re Snyder, 231 B.R. 437, 443 (Bankr. D. Mass. 1999).

No

Michigan

In re Strausbough, 426 B.R. 243 (Bankr. E.D. Mich. 2010). A tenancy by the entirety form of concurrent ownership is intended to protect the marital estate.  In a tenancy by the entirety neither husband nor wife may sell or encumber property to a third person without consent of the other spouse.  To the extent of joint debt, entireties property is not protected from claims of the joint creditors.

Pure Protection

Mississippi

Mississippi statutory authority states that assets of a debtor do not include “[a]n interest in property held in tenancy by the entireties to the extent it is not subject to process by a creditor holding a claim against only one tenant.” Miss. Code Ann. § 15-3-101(b)(iii) (Supp.2010).

Pure Protection

Missouri

Hanebrink v. Tower Grove Bank & Trust Company, 321 S.W. 2d 524, 527 (Mo. App. 1959).

Pure Protection

New Jersey

While New Jersey recognizes tenancy by the entireties, creditors of either spouse have the right to reach entireties property, including debtor-spouse’s present interest therein, subject to the right of survivorship; thus, a creditor who does so becomes a tenant in common, in possession with nondebtor-spouse. In re Etoll, 425 B.R. 743 (Bankr. D. N.J. 2010).

No

New York

A tenancy by the entirety cannot be divided absent consent of both spouses. Prario V. Novo, 645 N.Y.S. 2d 269 (N.Y. 1996) Applies only to real estate.

No

North Carolina

Where property is held as tenants by the entireties, any judgment against only one of the spouses may not attach to the real property while it remains as a tenancy by the entirety.  Dealer Supply Co. v. Greene, 522 S.E. 2d 350 (N.C. App. 1992).

Pure Protection

Ohio

Only recognizes TBE if established prior to April 4, 1985.

No

Oklahoma

Some, but not all, creditors can pursue the obligations of individual spouses in the entireties property. See 60 Okla. Stat. § 74.

No

Oregon

The interest of a judgment debtor spouse, as tenant by entirety with nondebtor spouse, may be sold on execution, and the execution purchaser only obtains the debtor spouse’s interest, which ceases to exist should a debtor spouse predecease the nondebtor spouse. Hoyt v. American Traders, Inc., 725 P.2d 336 (1986).

No

Pennsylvania

Property held as tenancy by the entireties is unavailable to satisfy the claims of the creditor of one of the tenants. Johnson v. Johnson, 908 A.2d 290 (2006).

Pure Protection

Rhode Island

In Cull v. Vadnais, 406 A.2d 1241 (1979), the court held that a creditor had the right to attach a debtor-spouse’s interest in real property held as tenancy by the entirety.

No

Tennessee

Where the debtor owns property with a nondebtor spouse in a tenancy by the entireties, only the debtor’s survivorship interest is subject to execution, not the debtor’s present, possessory interest. 16 Tenn. Prac., Debtor-Creditor Law and Practice § 15:33 (2d ed.).

No

Vermont

If a tenancy by the entirety is validly created, it is protected from the sole creditors of an individual debtor. RBS Citizens, N.A., v. Ouhrabka, 30 A.3d 1266 (Vt. 2011).  The court noted that the property held by husband and wife, as husband and wife, is protected from either the sole creditors of either the husband or the wife. Anchor Foundations, Inc. v. Ingalls, 191 Vt. 641 (Vt. 2011 Unpublished LEXIS case)

Pure Protection

Virginia

Property that is held in tenancy by the entirety by spouses is protected from the claims of the debtor’s individual creditors. In re Bradby, 455 B.R. 476 (Bankr. E.D. Va. 2011).

Pure Protection

Wyoming

Wyoming law does not allow a judgment creditor to seize property held by a husband and wife as tenants by the entirety to satisfy the individual debts of one of the spouses. Colorado Nat. Bank v. Miles, 711 P.2d 390, 393-94 (Wyo. 1985).

Pure Protection

 LAWYERS IN HISTORY:  THE IMPACT OF LAW PRACTICE ON THEIR LIVES AND CAREERS

Potter Stewart

Potter Stewart

Potter Stewart was an attorney who graduated from Yale Law School (and the school’s famous Skull and Bones society) in 1937.  He was a member of the U.S. Naval Reserve and served in World War II.  In 1954, at the age of 39, Potter was appointed to the United States Court of Appeals for the Sixth Circuit, and in 1959, he was nominated to the Supreme Court.  Potter served until he stepped down in 1981; his seat was then filled by none other than the first woman to sit on the Supreme Court, Sandra Day O’Conner.

Stewart was a member of the Supreme Court for landmark court decisions, including Griswold v. Connecticut, Miranda v. Arizona, Sierra Club v. Morton, Ginzburg v. United States, and Roe v. Wade.  He is known for both his statement on censorship from the Ginzburg v. United States dissent, “censorship reflects a society’s lack of confidence in itself.  It is a hallmark of an authoritarian regime,” and his statement from his concurrence in the obscenity case of Jacobellis v. Ohio, “pornography is hard to define, but I know it when I see it.”

However, in a later case he admitted that this last view, as a legal interpretative policy, was “simply untenable” and regretted that it seemed likely that those would be the words he was remembered for.  He died in 1985, and we hope you remember him more for his role in landmark decisions like Katz v. United States, a decision that expanded our Fourth Amendment protections.  Katz Deli in New York would not be open if this opinion had not been written, although no one is sure why.  They deliver, but only in the New York City area.

 KFC CEO for Japan Buys Colonel Sanders’ White Suit

            The President and CEO of Kentucky Fried Chicken in Japan, Masao “Charlie” Watanabe, has purchased Colonel Sanders white jacket and black tie at an auction for $21,510.  As you can see he wasted no time in trying on the jacket and tie.  To read the entire article please click here. Soy Sauce and Fries may be coming soon to a KFC near you.

 sanders25n-1-web

Applicable Federal Rates

Please click here to view a chart of this month’s, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale you can use the lowest of the 3.

Seminars and Webinars

  • LUNCH TALK – MEDICAL PRIVACY LAWS – HOW TO HANDLE STICKY SITUATIONS (WHAT EVERY LAWYER NEEDS TO KNOW)

Date:  Monday, July 1, 2013 | 12:30 p.m. (30 MINUTE PRESENATION)

Speaker: Lester Perling, Esq. and Vanessa Reynolds, Esq.

Location: Online webinar

Sponsor: The Clearwater Bar Association

Additional Information: To register please visit www.clearwaterbar.org or email Janine Ruggiero at Janine@gassmanpa.com

  • FLORIDA HEALTH CARE LAW CHANGES: HOW THEY AFFECT PHYSICIANS AND MEDICAL ENTERPRISES WEBINAR

Date:  Tuesday, July 2, 2013 | 12:30 p.m. – 1:00 p.m. and Wednesday, July 10, 2013 | 5:00 p.m. – 5:30 p.m.

Speakers: Healthcare Expert Lester Perling, J.D., M.H.A. and Alan S. Gassman, J.D., LL.M.

Location: Online webinar.

Additional Information: To register for the July 2nd at 12:30 p.m. webinar please click here.   To register for the July 10th at 5:00 p.m. webinar please click here.

BP OIL SPILL CLAIMS – AVOID MISTAKES AND MAXIMIZE CLAIMS

Date: Wednesday, July 17, 2013 | 5:00 p.m. – 5:30 p.m.

Speakers: John Goldsmith, Esq. and Alan S. Gassman

Location: Online webinar

Additional Information:  To register for this webinar please click here.

MEDICAL EDUCATION RESOURCES PRIMARY CARE CONFERENCE

Alan Gassman will be speaking on the topic of LEGAL, TAX AND FINANCIAL BOOT CAMP FOR THE MEDICAL PRACTICE – A SPECIAL TAX, ESTATE PLANNING AND LAW CONFERENCE FOR PRIMARY CARE PHYSICIANS

Date: July 19 – 21, 2013 (Friday – Sunday mornings; Have fun at Disney in the afternoons and we will not ask what you do at night!)

Topic:         1)             The 10 Biggest Mistakes That Physicians Make In Their Investments and Business Planning

9am – 10am on Friday, July 19, 2013

2)             Lawsuits 101

                                               10:10 am – 11:10 am on Friday, July 19, 2013

3)             Essential Estate Planning

                                               11:10 am – 11:40 am on Friday, July 19, 2013

4)             Asset Entity Planning for Creditor Protection and Buy Sell Arrangements

10:10 am – 11:10 am on Saturday, July 20, 2013

                    5)             50 Ways to Leave Your Overhead – How to Enhance Medical Practice Profitability

11:40 am – 12:40 pm on Saturday, July 20, 2013

                    6)             Stark Naked, or Well Prepared? – Health Law Compliance

9:00 am – 10:00 am on Sunday, July 21, 2013

Location: Disney’s Boardwalk Resort, Orlando, Florida

Topics by Other Speakers: 2013 Tax Changes, Tax Deductions for Physicians, Medical Practice Financial Management, Physician Compensation, Tax Structures for Medical Practices and Retirement Plan Options for Physicians.

Additional Information:  For more information please visit www.MER.org  Please note that the program qualifies for continuing education credit for physicians.

  • WEDU ESTATE PLANNING SEMINAR

Gassman Law Associates meets Big Bird – Sesame Street vs. Wall Street?

Alan Gassman will be speaking on the topic of ASSET PROTECTION – ESSENTIAL KNOWLEDGE AND HOT TOPICS

Leading trust law expert Bruce Stone, Esq. will also speak on a topic to be determined.

Date: Thursday, September 19, 2013 | 7:30 am – 11:30 am

Location: TBD

Additional Information:  If you would like to sign up for this seminar please email agassman@gassmanpa.com

  • NOTRE DAME TAX INSTITUTE

Jerry Hesch and Alan Gassman will be speaking on the topic of INTERESTING INTEREST QUESTIONS, PLANNING WITH LOW INTEREST LOANS, PRIVATE ANNUITIES, DEFECTIVE GRANTOR TRUSTS, AND PRIVATE AND COMMERCIAL ANNUITIES

Date: Wednesday, October 16 through Friday, October 18, 2013

Location: Notre Dame College, South Bend, Indiana

Additional Information: Professor Jerry Hesch’s Notre Dame Tax Institute will once again emphasize the importance of income tax planning and implications in addition to estate, estate tax, and related concepts.

Email us now to get your football tickets to the Notre Dame-USC game on October 19.

We welcome questions, comments and suggestions for the presentation that we are assisting Jerry in preparing and presenting.

 

  • PINELLAS COUNTY ESTATE PLANNING COUNCIL SEMINAR

Alan Gassman will be speaking on the topic of HOT TOPICS FOR ESTATE PLANNERS

Date: Wednesday, October 23, 2013 | 8:00 am – 12:00 p.m. (60 MINUTE PRESENTATION)

Location: TBD

Additional Information: To attend the meeting or to receive information on joining the Council please click here  or email agassman@gassmanpa.com

2013 MOTE VASCULAR SURGERY FELLOWS – FACTS OF LIFE TALK SEMINAR FOR FIRST YEAR SURGEONS

Alan Gassman will be speaking on the topic of ESTATE, MEDICAL PRACTICE, RETIREMENT, TAX, INSURANCE, AND BUY/SELL PLANNING – THE EARLIER YOU START THE SOONER YOU WILL BE SECURE

Date: October 25 – 27, 2013 | Times TBD

Location: TBD

Additional Information: Please contact agassman@gassmanpa.com for additional information.

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE) HEALTH LAW SYMPOSIUM – AN ALL DAY SEMINAR

Alan Gassman will be speaking on the topic of WHAT HEALTH LAWYERS NEED TO KNOW ABOUT FLORIDA LAW

Date: Friday, November 1, 2013 | 9am – 5pm (Mr. Gassman speaks from 1:10 pm until 2:10 p.m.)

Location: Seton Hall Law School, Newark, New Jersey

Additional Information: Seton Hall University in South Orange, New Jersey was founded in 1856, and they have remodeled since.  Today, Seton Hall has over 10,000 students in its undergraduate, graduate and law school programs and is in close proximity to several Kentucky Fried Chicken locations.

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE)_SPECIAL 3 HOUR SESSION

Alan Gassman will be speaking on the topic of WHAT NEW JERSEY LAWYERS NEED TO KNOW ABOUT FLORIDA LAW – A 3 HOUR OVERVIEW BY ALAN S. GASSMAN

Date: Saturday, November 2, 2013

Location: Wilshire Grand Hotel, West Orange, New Jersey | 9am – 12pm

Additional Information: Please tell all of your friends, neighbors and enemies in New Jersey to come out to support this important presentation for the New Jersey Bar Association.  We will include discussions of airboats, how to get an alligator off of your driveway, how to peel a navel orange and what collard greens and grits are. For additional information please email agassman@gassmanpa.com

  • SALT LAKE CITY ESTATE PLANNING COUNCIL’S FALL ONE DAY “TAX AND DEDUCTIBILITY OF YOUR SKI TRIP” INSTITUTE

Alan Gassman will be speaking on the topic of PRACTICAL ESTATE PLANNING, WITH A $5.25 MILLION EXEMPTION AMOUNT

Date: Thursday, November 7, 2013

Location: Hilton Downtown Salt Lake City, Utah

Additional Information:  Please support this one day annual seminar conveniently located near skiing and tourism opportunities.  If you would like to attend this event or receive the materials please email agassman@gassmanpa.com

NOTABLE SEMINARS PRESENTED BY OTHERS:

  • 48th ANNUAL HECKERLING INSTITUTE ON ESTATE PLANNING SEMINAR

Date: January 13 – 17, 2014

Location:  Orlando World Center Marriott, Orlando, Florida

Sponsor: University of Miami School of Law

Additional Information: For more information please visit: http://www.law.miami.edu/heckerling/

  • 16th ANNUAL ALL CHILDREN’S HOSPITAL ESTATE, TAX, LEGAL & FINANCIAL PLANNING SEMINAR

Date: Wednesday, February 12, 2014

Location: All Children’s Hospital Education and Conference Center, St. Petersburg, Florida with remote location live interactive viewings in Tampa, Sarasota, New Port Richey, Lakeland, and Bangkok, Thailand

Sponsor: All Children’s Hospital

THE UNIVERSITY OF FLORIDA TAX INSTITUTE

Date: February 19 – 21, 2014

Location: Grand Hyatt, Tampa, Florida

Sponsor:  UF Law alumni and UF Graduate Tax Program

Additional Information:  Here is what UF is saying about the program on its website: “The UF Tax Institute will provide tax practitioners and other leading tax, business and estate planning professionals with a program that covers the most current issues and planning ideas with a practical, informative, state-of-the-art approach.  The Institute’s schedule will devote separate days or half days to individual income tax issues, entity tax issues and estate planning issues.  Speakers and presentations will be announced as the program date nears to ensure coverage of the most timely and significant topics.  UF Law alumni have formed the Florida Tax Education Foundation, Inc., a nonprofit corporation, to organize the conference.”

For details about each event, please visit us online at gassmanlawassociates.com/newsandevents.html

Thank you to our law clerks that assisted us in preparing this report.

The Thursday Report – June 20, 2013 – New Florida Laws Explained

Posted on: June 20th, 2013

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New Florida Laws Explained:

1.   30 Day Rental Provision for Homestead

2.   Fraudulent Transfers to Charities Exemption

3.   Physician Assistants Are Now Able to Order Controlled Substances for Hospital, Surgery Center and Mobile Surgical Facility Use

4.   Optometrists Now Able to Administer and Prescribe Some Pain Relief Medications

Gary Teblum on the New LLC Laws– Part 2

What to Tell Clients if and When Investigators Show Up at Their Door by Gabriel Imperato, Esq.

Our New Tampa Office Finally Gets It’s Sign!

Lawyers in History: The Impact of Law Practice on their Lives and Careers: James K. Polk

Our Favorite Animal Poems by Ogden Nash

We welcome contributions for future Thursday Report topics. If you are interested in making a contribution as a guest writer, please email Janine Ruggiero at Janine@gassmanpa.com.

This report and other Thursday Reports can be found on our website at www.gassmanlawassociates.com.

New Florida Laws Explained

1.   30 Day Rental Provisions for Homestead

Governor Scott has signed into law Senate Bill 342 – Rental of Homestead Property, and it is scheduled to take effect on July 1, 2013.  The new law amends Florida Statute § 196.061.

Under the old statute, enacted in 1996, a homeowner’s rental of “all or substantially all” of his or her homesteaded property meant that he or she had “abandoned” the homestead and therefore lost the ad valorem tax protection.  The caveat to the law was that a homeowner turning his homestead property into such a rental after the first day of a given calendar year would not lose the homestead exemption for that calendar year, so long as the property had not also been rented the previous calendar year.

SB 342 clarifies the statute and limits the exception.  Now, a property owner who rents out his or her homestead for more than 30 days per year for two consecutive years will lose the homestead exemption tax benefits on that property.

2.   Fraudulent Transfers to Charities Exemption

The governor has also signed HB – 95 Charitable Contributions.  The bill amends Florida’s Uniform Fraudulent Transfers Act (FUFTA), Florida Statute § 726, so that it provides debtors with a defense to a creditor’s “clawback” action on funds transferred to a religious or charitable entity.

Effective July 1st, FUFTA will be amended to prevent creditors from attempting to “clawback” donations made by debtors to qualified religious or charitable organizations, if it can be shown that the organization received the donation in good faith and more than two years before the commencement of an action to set aside the transfer or the filing of a bankruptcy petition. The statute also includes a “value” defense, which states that a transfer from a debtor to a charity within two years will not be considered fraudulent if the transfer was consistent with past practices of the debtor, or if the transfer was received in good faith and the contribution did not exceed 15% of the gross income of the debtor. These exemptions apply only to individual debtors, and not corporate entities.

Florida’s charitable contribution exemption now closely resembles that of the federal bankruptcy code, 11 U.S.C. 548(a)(2), the main difference being the Florida law’s reference to good faith on the part of the recipient organization.

The Florida Statute exemption, § 726.109(7)(b) will now read:

(b) However, a charitable contribution from a natural person is a fraudulent transfer if the transfer was received on, or within 2 years before, the earlier of the date of commencement of an action under this chapter, the filing of a petition under the federal Bankruptcy Code, or the commencement of insolvency proceedings by or against the debtor under any state or federal law, including the filing of an assignment for the benefit of creditors or the appointment of a receiver, unless:

(1) The transfer was consistent with the practices of the debtor in making the charitable contribution; or

(2) The transfer was received in good faith and the amount of the charitable contribution did not exceed 15 percent of the gross annual income of the debtor for the year in which the transfer of the charitable contribution was made.

The bankruptcy code exemption reads as follows:

(2) A transfer of a charitable contribution to a qualified religious or charitable entity or organization shall not be considered to be a transfer covered under paragraph (1)(B) in any case in which—

(A) the amount of that contribution does not exceed 15 percent of the gross annual income of the debtor for the year in which the transfer of the contribution is made; or

(B) the contribution made by a debtor exceeded the percentage amount of gross annual income specified in subparagraph (A), if the transfer was consistent with the practices of the debtor in making charitable contributions.

3.   Physician Assistants Are Now Able to Order Controlled Substances for Hospital, Surgery Center and Mobile Surgical Facility Use

Senate Bill 398 amends Florida Statutes §§ 458.347 and 459.022, giving medical and osteopathic doctors the right to delegate the authority to “order” medications, including controlled substances, for patients in hospitals, ambulatory surgical centers, and mobile surgical facilities beginning July 1, 2013.  Under present law, a physician assistant (“PA”) under the supervision of a physician is not able to order from a list of medications referred to as a “negative formulary,” which are listed in both sections 458.347(4)(e) and 459.022(4)(e).  The list includes controlled substances, general anesthetics, and radiographic contrast materials.

There is a difference between a “prescription” and an “order.”  The term order is used in a hospital or institutional setting when an authorized practitioner (physician, physician assistant, etc.) requests a medication for an admitted patient. That order is transcribed in the patient’s medical records and is administered on site by a nurse or other licensed health care personnel. A prescription, according to the Florida Pharmacy Act, includes any order for drugs or medicinal supplies communicated by any means by a licensed practitioner authorized by the laws of the state to prescribe such. Unlike an order, which is administered by a nurse or other qualified personnel; a prescription is dispensed by a pharmacist.

The amendments authorize a supervisory physician to delegate to his or her PA the authority to order medications, including controlled substances, for the physician’s patient in any hospital, ambulatory surgical center or mobile surgical facility.

4.  Optometrists Now Able to Administer and Prescribe Some Pain Relief Medications

Licensed, certified optometrists are now authorized to give and prescribe “oral ocular pharmaceuticals agents” for pain relief.  Oral ocular pain relief sounds like what you need after experiencing the “eyes-bigger-than-stomach” phenomenon.

HB 239 – Practice of Optometry gives optometrists the ability to dispense these topically or orally administered ocular pain relief agents only after they submit proof to the DOH that they have passed a 20-hour certification course and exam.  To get the go-ahead from the DOH, proof of passing must be submitted no later than October 1, 2013.

The authority granted by the new law is limited; it prohibits optometrists from dispensing the drugs for the purpose of treating any systemic disease as well as from administering or prescribing Schedule I or II controlled substances.

Gary Teblum on the New LLC Laws – Part 2

Gary Teblum

We had the opportunity to interview Gary Teblum who is on the drafting committee for the new LLC statute.  With no further adieu you can read the second part of this interview below.  To read part 1 of this excellent interview please click here.

Gary I. Teblum, J.D., is widely known as being one of the best securities, business, and corporate lawyers in the state of Florida.  Gary’s work ethic, exactness, and high standard of practice and ethics is well known throughout Florida and much appreciated by his loyal client base and those of us who are fortunate enough to work with him.  Gary has been with the firm of Trenam Kemker Scharf Barkin Frye O’Neill and Mullis, P.A. in Tampa since 1979 and has been a shareholder since 1984. He is the co-leader of the firm’s Business Transactions Practice Group, which handles all types of business transactions including entity selection, formation and operations, mergers and acquisitions, equity and debt financing, executive compensation, ERISA and employee benefits, and business and individual tax planning and tax controversies. His work covers most of these types of transactions as well as most types of business contracts, and includes advising both publicly held and privately held companies with regard to corporate, partnership and limited liability company law, securities laws, and other various business laws impacting the operations of the clients’ respective businesses. Mr. Teblum has been active in the Business Law Section of the Florida Bar, including most recently serving as one of the core members of the drafting committee for the newly passed Florida Revised Limited Liability Company Act that is awaiting approval by the Governor. He holds a law degree from the Law School of the University of Pennsylvania and a Bachelor of Science degree in accounting from the University of Delaware.

This interview was also edited by Kenneth J. Crotty of our firm, who now has the pleasure of rewriting his chapter on limited liability companies in the Florida Bar’s book entitled Florida Small Business Practice.  We look forward to riding Ken’s coattails on this endeavor and we welcome any questions, comments, or suggestions for Ken’s chapter, or if you would like to be a beta reader please let us know.

GARY TEBLUM:     We have cleaned up the merger and conversion provisions, and in particular how these entities, both within LLCs, and also across entities, can merge or can convert either into an LLC or out of an LLC into another entity.

ALAN GASSMAN:   What are some of the provisions that provide for new concepts?

GARY TEBLUM:     We have added a few new concepts, and in particular the concepts of interest exchanges and in-bound domestications.  We did not include out-bound domestications.  For these purposes, domestications are just domestications of entities existing in other countries, not domestications of entities existing in other states.

We have also added some new events that trigger appraisal rights and we have fixed a glitch in the appraisal rights that appears in our current statute in circumstances where, for example, you are approving a merger transaction or some other type of transaction by way of a written consent.  Indeed, in this context, under the current statute, the statutory provisions just did not work.  There was a circularity to it.  In the new LLC Act, we fixed that problem and put a procedure together that we believe is relatively easy to follow and much more intuitive.

ALAN GASSMAN    Did the committee consider adopting the concept of series LLCs?

GARY TEBLUM:     We did consider whether to adopt the concept of series LLCs, similar to what exists in Delaware, but we made a determination that we did not want to go there.  We were concerned that, because of the more typical types of businesses that are forming LLCs in Florida, Series LLCs might be used improperly.  As a result, we did not want to make the concept of Series LLCs a part of the new Florida LLC Act.  We are open to possible amending the Act in the future when there has been a lot more clarification throughout the country with respect to Series LLCs.  Our decision on this parallels the Uniform Act, which does not include a provision authorizing series LLCs.

ALAN GASSMAN:   I have been asked a few times by various lawyers whether I thought you could have a Delaware Series LLC that has the separate insulated cells and have it operate in Florida and have the separated insulated cells respected here.  Have you ever looked into that?  Do you think there is any chance that would work?

GARY TEBLUM:     Yes, I think that there is a chance it works.  I will tell you, however, that the Florida Department of State has some special rule interpretations as to how the separate cells must be handled.  In particular, the DOS, requires each separate cell to be qualified to transact business in the state, so you cannot just qualify the series as a single LLC.  I believe that, based on giving full faith and credit to the law of the state of formation, Florida should respect the separateness of the cells from liability perspective because it is a matter of internal affairs. Of course, I would expect that the ability to respect the separateness will be dependent on making certain that the facts are such that no piecing of the veil argument could be successfully advanced.  On the other hand, I would caution that, as far as I know, no Florida court has addressed this separateness of liability for out-of-state series LLCs.  Remember, we did not expect the result in Olmstead.  Thus, until the actual case presents itself and there is a definitive ruling, we really have no idea what the Florida Supreme Court ultimately would do.

ALAN GASSMAN:   Should an LLC series have its own EIN?

GARY TEBLUM:     You know, I do not like series LLCs because I believe the concept should be used in only limited circumstances, which few practitioners in Florida, including me, tend to see.  Thus, my expertise with Series LLCs is very limited.  Nevertheless, my impression is that most practitioners who use Series LLCs will get a separate EIN for each series.  In this regard, remember that the Florida LLC statute – both the current statute and the new legislation, does not include a provision addressing Series LLCs.

ALAN GASSMAN:   What did the committee do about “shelf LLCs”?

GARY TEBLUM:     We also did not elect to have the new Florida LLC Act allow for what is commonly referred to as shelf LLCs.  That is where you can form an LLC and sort of hold it on a shelf.  It does not have any members, and then when you are ready to utilize it, you take it down.  We did not think it was appropriate.  The Commissioners of the Uniform Act also did not think that allowing for the formation of shelf LLCs was appropriate.  Under the new Florida LLC Act, the concept of shelf LLCs will not exist and therefore you would not be able to form an LLC in Florida unless at the time of formation the LLC has at least one member.

ALAN GASSMAN:   Gary, we cannot thank you enough, not only for spending the time to explain the above, but also for all of your hard efforts and the efforts of everyone who participated in helping Florida to vastly improve its LLC Statute.

GARY TEBLUM:     Thanks Alan. I would encourage every lawyer reading this interview to consider becoming involved with your Florida Bar section in legislative efforts.  Hundreds of hours go into this every year, and it is clearly for the betterment of our clients, our profession, and our state business community.

What to Tell Clients if and When Investigators Show Up at Their Door and What Clients Can Tell Their Employees

By: Gabriel Imperato

gimperato

Many times the government will investigate clients and their health care entities, and questions arise as to what to communicate to employees, and whether to offer them legal counsel or advice.  It is important not to interfere with a governmental investigation, but getting the right information and advice to the right people can be very important, and we are very thankful to Gabe Imperato, Esq. of the Broad and Cassel firm for the following memo that is very well written.  Gabe’s practice and contact information is as set forth below:

Gabe L. Imperato is the Managing Partner of the Fort Lauderdale office of Broad and Cassel and serves on the Firm’s Executive Committee.  He is a member of the Health Law Practice Group and is the co-chair of the Firm’s White Collar Defense and Compliance Practice Group.  Mr. Imperato’s personal practice includes representing individuals and organizations accused of health care fraud and assisting and advising health care organizations on corporate governance and compliance matters.  Mr. Imperato is board certified as a specialist in health law by the Florida Bar.  He is also certified in Health Care Compliance (HCC) by the Health Care Compliance Association, where he sits on the Board of Directors and is the Second Vice President.

He has served as Deputy Chief Counsel, Office of the General Counsel, United States Department of Health and Human Services, Dallas, Texas.  He advised and represented various agencies of the Department of Health and Human Services, including the Center for Medicare and Medicaid Services, the Public Health Service, the Social Security Administration and the Office of the Inspector General.

Gabe can be reached at Broad and Cassel, 954-745-5223 or via email at gimperato@broadandcassel.com.

Below is his memorandum:

  1. A government investigator has the right to contact you and request to speak with you.
  2. You have the right to choose whether or not to speak with any investigator.  In all situations you have the right to consult with legal counsel before you decide whether or not to talk to an investigator.
  3. The government investigator does not have the right to insist upon an interview, and it is improper for him or her to pressure you in an attempt to obtain an interview, because it is completely your choice whether or not to speak with any investigator.
  4. If you decide to refuse an interview, you should politely, but firmly decline the investigator’s request, but ask him or her for agency and contact information.
  5. Since you are not required to submit to an interview, if you decide that you are willing to submit to one, you have the right to insist upon any precondition you desire.  For example, you may require that the interview be conducted only in the presence of legal counsel.  In some situations, your employer will pay for the cost of an attorney to represent you.
  6. Regardless of your decision, if you are contacted by a government investigator, it is extremely helpful if you immediately contact your supervisor at your place of employment and/or legal counsel.

You have every legal right to tell your employer about the government contact.  The agent may request or suggest that you keep the contact confidential, but there is no law that would prevent you from disclosing any detail of your discussion with the agents.  An employer should expect employees to advise of such government contacts.

  1. Employees often wonder what their employer would prefer.  The answer is that the decision is truly yours.  However, most employers (and their lawyers) would strongly encourage you to conduct the interview with legal counsel present.
  2. Under all circumstances, remember that you must tell the truth to government agents.  Failure to do so may, in and of itself, be a violation of the law.
  3. Do not destroy any documents or attempt to hide evidence under any circumstances.

 

Man and Sanders.200

Gabe’s partner, Lester Perling and Alan Gassman recorded a webinar called Unannounced Medicare Audits – What To Do If Investigators Come to Your Office, which can be viewed by clicking here.

Our New Tampa Office Finally Gets It’s Sign!

The rent check has cleared

The sign has been erected

Tom Ellwanger is ready

To get your problems corrected.

Tampa Sign Pic

Lawyers in History: The Impact of Law Practice on their Lives and Careers: James K. Polk

James K. Polk

James Polk

James K. Polk (extra Thursday Report points if you “kno”w what the K stands for) probably doesn’t get the common attention and accolades he deserves for his performance as the 11th President of the United States.  Scholars, however, have noted his importance to the early United States, with the Daily Beast recently calling him the “least known consequential president.”  Thanks to his leadership, our nation made its greatest territorial expansion since the Louisiana Purchase during his sole term in the White House.

Under Polk’s stead, the United States annexed the Oregon territory, which today makes up Oregon, Idaho, Washington and the Republic of Texas, leading to a slight misunderstanding with Mexico that culminated in the 1846 Mexican-American War, and added what is today California, Nevada, Utah, most of Arizona, and parts of New Mexico, Colorado and Wyoming through the Treaty of Guadalupe Hidalgo that ended the Mexican-American War.

James Polk attended the of North Carolina.  After graduating with honors, he studied law under a Nashville trial attorney, and was admitted to the bar in 1820.  For his first case, he defended a client with a public fighting charge.  Polk got a mixed verdict – his client was released, but fined one dollar.  The client?  His father.

Polk began his political career in the House of Representatives, and later became Speaker of the House (1835), Governor of Tennessee, and became the youngest man at the time to become president in 1845.

And Polk’s one-term presidency was not a result of his failure to win re-election, quite the opposite.  When he ran in 1845 he promised he would not seek a second term, and he kept his word.

Our Favorite Animal Poems by Ogden Nash

            If you or your children have never read Ogden Nash buy some of his books immediately.  He was truly a genius for his time, and the favorite poet for many.  Anyone who would like to co-write the tax song of J. Alfred Prufrock can contact us immediately.

The Camel

 The camel has a single hump.

The dromedary two.

Or else the other way around.

I’m not sure, are you?

 The Dog

The truth I do not stretch or shove

When I state that the dog is full of love.

I’ve also found, by actual test,

A wet dog is the lovingest.

The Duck

Behold the duck.

It does not cluck.

A cluck it lacks.

It quacks.

It is specially fond

Of a puddle or pond.

When it dines or sups,

It bottoms ups.

The Termite

Some primal termite knocked on wood

And tasted it, and found it good!

And that is why your Cousin May

Fell through the parlor floor today.

The Panther

The panther is like a leopard,

Except it hasn’t been peppered.

Should you behold a panther crouch,

Prepare to say Ouch.

Better yet, if called by a panther,

Don’t anther.

Puma from Yuma

A jolly young fellow from Yuma

Told an elephant joke to a puma;

now his skeleton lies

beneath hot western skies-

the puma had no sense of huma”

-      Ogden Nash

Applicable Federal Rates

Please click here to view a chart of this month’s, last month’s, and the preceding month’s Applicable Federal Rates, because for a sale you can use the lowest of the 3.

Seminars and Webinars

  • SUNCOAST CHAPTER OF THE FICPA MONTHLY MEETING

Alan Gassman will be speaking on the topic of 2 FASCINATING PLANNING SESSIONS: (A) ESTATE AND INCOME TAX PLANNING – 2013; and (B) THE CPA’S GUIDE TO ASSET PROTECTION FOR PROFESSIONALS AND PROFESSIONAL PRACTICES

Date:  Thursday, June 20, 2013 | 4:00 – 7:00 p.m. (3 HOUR PRESENTATION)

Speakers:       Alan S. Gassman and Christopher J. Denicolo

Location:        Feathersound Country Club, Clearwater, Florida

Additional Information: If you would like to attend this meeting or receive a copy of the materials please email agassman@gassmanpa.com

  • THE 444 SHOW – FORENSIC EXAMINATION OF INSURANCE POLICIES

Date:  Thursday, June 27, 2013 | 4:00 – 4:50 pm

Speaker:         Dennis Wall, Esq.

Location:        Online webinar

Sponsor:         The Clearwater Bar Association

Additional Information: To register for this webinar please click here or email Janine@gassmanpa.com

  • LUNCH TALK – MEDICAL PRIVACY LAWS – HOW TO HANDLE STICKY SITUATIONS (WHAT EVERY LAWYER NEEDS TO KNOW)

Date:  Monday, July 1, 2013 | 12:30 p.m. (30 MINUTE PRESENATION)

Speaker: The Amazing Lester Perling, J.D., M.H.A.

Location: Online webinar

Sponsor: The Clearwater Bar Association

Additional Information: To register please visit www.clearwaterbar.org or email Janine Ruggiero at Janine@gassmanpa.com

  • FLORIDA HEALTH CARE LAW CHANGES: HOW THEY AFFECT PHYSICIANS AND MEDICAL ENTERPRISES WEBINAR

Date:  Tuesday, July 2, 2013 | 12:30 p.m. – 1:00 p.m. and Wednesday, July 10, 2013 | 5:00 p.m. – 5:30 p.m.

Speakers: Healthcare Expert Lester Perling, J.D., M.H.A. and Alan S. Gassman, J.D., LL.M.

Location: Online webinar.

Additional Information: To register for the July 2nd at 12:30 p.m. webinar please click here.   To register for the July 10th at 5:00 p.m. webinar please click here.

  •  BP OIL SPILL CLAIMS – AVOID MISTAKES AND MAXIMIZE CLAIMS

Date: Wednesday, July 17, 2013 | 5:00 p.m. – 5:30 p.m.

Speakers: John Goldsmith, Esq. and Alan S. Gassman

Location: Online webinar

Additional Information:  To register for this webinar please click here.

  •  MEDICAL EDUCATION RESOURCES PRIMARY CARE CONFERENCE

Alan Gassman will be speaking on the topic of LEGAL, TAX AND FINANCIAL BOOT CAMP FOR THE MEDICAL PRACTICE – A SPECIAL TAX, ESTATE PLANNING AND LAW CONFERENCE FOR PRIMARY CARE PHYSICIANS

Date: July 19 – 21, 2013 (Friday – Sunday mornings; Have fun at Disney in the afternoons and we will not ask what you do at night!)

Topic:         1)             The 10 Biggest Mistakes That Physicians Make In Their Investments and Business Planning

9am – 10am on Friday, July 19, 2013

2)             Lawsuits 101

                                                10:10 am – 11:10 am on Friday, July 19, 2013

3)             Essential Estate Planning

                                                11:10 am – 11:40 am on Friday, July 19, 2013

4)             Asset Entity Planning for Creditor Protection and Buy Sell Arrangements

10:10 am – 11:10 am on Saturday, July 20, 2013

                    5)             50 Ways to Leave Your Overhead – How to Enhance Medical Practice Profitability

11:40 am – 12:40 pm on Saturday, July 20, 2013

                    6)             Stark Naked, or Well Prepared? – Health Law Compliance

9:00 am – 10:00 am on Sunday, July 21, 2013

Location: Disney’s Boardwalk Resort, Orlando, Florida

Topics by Other Speakers: 2013 Tax Changes, Tax Deductions for Physicians, Medical Practice Financial Management, Physician Compensation, Tax Structures for Medical Practices and Retirement Plan Options for Physicians.

Additional Information:  For more information please visit www.MER.org  Friends and colleagues of The Thursday Report can attend at the special rate of $495 (a savings of $200).  To receive the discount when registering please call 800-421-3756 or visit their website www.MER.org and on the payment page select “other” when registering.  The Thursday Report and Gassman Law Associates, P.A. derive no compensation from attendees or recommending clients to attend this program.

Rooms have been blocked off at Disney Boardwalk Hotel.  The group rate is $229 per night (before taxes).  You can make your reservations for your hotel through the MER website as well.  Locate the conference by either location or subject, click on “Program Information” and then “Accommodations” and then on “Reservation Link.”  If you would like to call Disney directly to make your reservations please call 407-934-3372 and let them know the group code of G0611977.

Please note that the program qualifies for continuing education credit for physicians.

  • WEDU ESTATE PLANNING SEMINAR

Gassman Law Associates meets Big Bird – Sesame Street vs. Wall Street?

Alan Gassman will be speaking on the topic of ASSET PROTECTION – ESSENTIAL KNOWLEDGE AND HOT TOPICS

Leading trust law expert Bruce Stone, Esq. will also speak on a topic to be determined.

Date: Thursday, September 19, 2013 | 7:30 am – 11:30 am

Location: TBD

Additional Information:  If you would like to sign up for this seminar please email agassman@gassmanpa.com

  • NOTRE DAME TAX INSTITUTE

Jerry Hesch and Alan Gassman will be speaking on the topic of INTERESTING INTEREST QUESTIONS, PLANNING WITH LOW INTEREST LOANS, PRIVATE ANNUITIES, DEFECTIVE GRANTOR TRUSTS, AND PRIVATE AND COMMERCIAL ANNUITIES

Date: Wednesday, October 16 through Friday, October 18, 2013

Location: Notre Dame College, South Bend, Indiana

Additional Information: Professor Jerry Hesch’s Notre Dame Tax Institute will once again emphasize the importance of income tax planning and implications in addition to estate, estate tax, and related concepts.

Email us now to get your football tickets to the Notre Dame-USC game on October 19.

We welcome questions, comments and suggestions for the presentation that we are assisting Jerry in preparing and presenting.

 

  • 2nd ANNUAL PINELLAS COUNTY ESTATE PLANNING SEMINAR

Alan Gassman will be speaking on the topic of HOT TOPICS FOR ESTATE PLANNERS

Date: Wednesday, October 23, 2013 | 7:30 am – 12:00 p.m. (60 MINUTE PRESENTATION)

Location: Ruth Eckerd Hall, Clearwater, Florida

Additional Information: In addition to Alan Gassman, Sean Casey, Director, Reigional Portfolio Management and Senior Vice President with Fifth Third in Naples, Fl., Sandra F. Diamond, Esq. of Williamson, Diamond & Caton, P.A. and Barry D. Flagg, CFP, CLU, ChFC will be speaking on topics of interest.  The cost to attend the meeting is $75.00.  To attend the meeting or to receive information on joining the Council please click here or email Ellen Mantegna at emantegna@verizon.net  This seminar qualifies for 4 hours of continuing education credit for attorneys, CPAs, CFPs, CTFAs and CLUs.

  •  2013 MOTE VASCULAR SURGERY FELLOWS – FACTS OF LIFE TALK SEMINAR FOR FIRST YEAR SURGEONS

Alan Gassman will be speaking on the topic of ESTATE, MEDICAL PRACTICE, RETIREMENT, TAX, INSURANCE, AND BUY/SELL PLANNING – THE EARLIER YOU START THE SOONER YOU WILL BE SECURE

Date: October 25 – 27, 2013 | Times TBD

Location: TBD

Additional Information: Please contact agassman@gassmanpa.com for additional information.

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE) HEALTH LAW SYMPOSIUM – AN ALL DAY SEMINAR

Alan Gassman will be speaking on the topic of WHAT HEALTH LAWYERS NEED TO KNOW ABOUT FLORIDA LAW

Date: Friday, November 1, 2013 | 9am – 5pm (Mr. Gassman speaks from 1:10 pm until 2:10 p.m.)

Location: Seton Hall Law School, Newark, New Jersey

Additional Information: Seton Hall University in South Orange, New Jersey was founded in 1856, and they have remodeled since.  Today, Seton Hall has over 10,000 students in its undergraduate, graduate and law school programs and is in close proximity to several Kentucky Fried Chicken locations.

  • NEW JERSEY INSTITUTE FOR CONTINUING LEGAL EDUCATION (ICLE)_SPECIAL 3 HOUR SESSION

Alan Gassman will be speaking on the topic of WHAT NEW JERSEY LAWYERS NEED TO KNOW ABOUT FLORIDA LAW – A 3 HOUR OVERVIEW BY ALAN S. GASSMAN

Date: Saturday, November 2, 2013

Location: Wilshire Grand Hotel, West Orange, New Jersey | 9am – 12pm

Additional Information: Please tell all of your friends, neighbors and enemies in New Jersey to come out to support this important presentation for the New Jersey Bar Association.  We will include discussions of airboats, how to get an alligator off of your driveway, how to peel a navel orange and what collard greens and grits are. For additional information please email agassman@gassmanpa.com

  • SALT LAKE CITY ESTATE PLANNING COUNCIL’S FALL ONE DAY “TAX AND DEDUCTIBILITY OF YOUR SKI TRIP” INSTITUTE

Alan Gassman will be speaking on the topic of PRACTICAL ESTATE PLANNING, WITH A $5.25 MILLION EXEMPTION AMOUNT

Date: Thursday, November 7, 2013

Location: Hilton Downtown Salt Lake City, Utah

Additional Information:  Please support this one day annual seminar conveniently located near skiing and tourism opportunities.  If you would like to attend this event or receive the materials please email agassman@gassmanpa.com

NOTABLE SEMINARS PRESENTED BY OTHERS:

  • 48th ANNUAL HECKERLING INSTITUTE ON ESTATE PLANNING SEMINAR

Date: January 13 – 17, 2014

Location:  Orlando World Center Marriott, Orlando, Florida

Sponsor: University of Miami School of Law

Additional Information: For more information please visit: http://www.law.miami.edu/heckerling/

  • 16th ANNUAL ALL CHILDREN’S HOSPITAL ESTATE, TAX, LEGAL & FINANCIAL PLANNING SEMINAR

Date: Wednesday, February 12, 2014

Location: All Children’s Hospital Education and Conference Center, St. Petersburg, Florida with remote location live interactive viewings in Tampa, Sarasota, New Port Richey, Lakeland, and Bangkok, Thailand

Sponsor: All Children’s Hospital

  • THE UNIVERSITY OF FLORIDA TAX INSTITUTE

Date: February 19 – 21, 2014

Location: Grand Hyatt, Tampa, Florida

Sponsor:  UF Law alumni and UF Graduate Tax Program

Additional Information:  Here is what UF is saying about the program on its website: “The UF Tax Institute will provide tax practitioners and other leading tax, business and estate planning professionals with a program that covers the most current issues and planning ideas with a practical, informative, state-of-the-art approach.  The Institute’s schedule will devote separate days or half days to individual income tax issues, entity tax issues and estate planning issues.  Speakers and presentations will be announced as the program date nears to ensure coverage of the most timely and significant topics.  UF Law alumni have formed the Florida Tax Education Foundation, Inc., a nonprofit corporation, to organize the conference.”

For details about each event, please visit us online at gassmanlawassociates.com/newsandevents.html

Alan S. Gassman, J.D., LL.M. is a practicing lawyer and author based in Clearwater, Florida. Mr. Gassman is the founder of the firm Gassman Law Associates, P.A., which focuses on the representation of physicians, high net worth individuals, and business owners in estate planning, taxation, and business and personal matters.  He is the lead author on Bloomberg BNA’s Estate Tax Planning and 2011 and 2012, Creditor Protection for Florida Physicians, Gassman & Markham on Florida and Federal Asset Protection Law, A Practical Guide to Kickback and Self-Referral Laws for Florida Physicians, The Florida Physician Advertising Handbook  and The Florida Guide to Prescription, Controlled Substance and Pain Medicine Laws, among others.  Mr. Gassman is a frequent speaker for continuing education programs, publishes regularly for Bloomberg BNA Tax & Accounting, Estates and Trusts Magazine, Estate Planning Magazine and Leimberg Estate Planning Network (LISI).  He holds a law degree and a Masters of Law degree (LL.M.) in Taxation from the University of Florida, and a business degree from Rollins College.  Mr. Gassman is board certified by the Florida Bar Association in Estate Planning and Trust Law, and has the Accredited Estate Planner designation for the National Association of Estate Planners & Councils.  Mr. Gassman’s email is Agassman@gassmanpa.com.

Thomas J. Ellwanger, J.D., is a lawyer practicing at the Clearwater, Florida firm of Gassman Law Associates, P.A.  Mr. Ellwanger received his B.A. in 1970 from Northwestern University and his J.D. with honors in 1974 from the University of Florida College of Law.  His practice areas include estate planning, trust and estate administration, personal tax planning and charitable tax planning.  Mr. Ellwanger is a member of the American College of Trusts and Estates Counsel (ACTEC). His email address is tom@gassmanpa.com.

Christopher Denicolo, J.D., LL.M. is a partner at the Clearwater, Florida law firm of Gassman Law Associates, P.A., where he practices in the areas of estate tax and trust planning, taxation, physician representation, and corporate and business law.  He has co-authored several handbooks that have been featured in Bloomberg BNA Tax & Accounting, Steve Leimberg’s Estate Planning and Asset Protection Planning Newsletters, and the Florida Bar Journal. He is also the author of the Federal Income Taxation of the Business Entity Chapter of the Florida Bar’s Florida Small Business Practice, Seventh Edition. Mr. Denicolo received his B.A. and B.S. degrees from Florida State University, his J.D. from Stetson University College of Law, and his LL.M. (Estate Planning) from the University of Miami.  His email address is Christopher@gassmanpa.com.

Kenneth J. Crotty, J.D., LL.M., is a partner at the Clearwater, Florida law firm of Gassman Law Associates, P.A., where he practices in the areas of estate tax and trust planning, taxation, physician representation, and corporate and business law. Mr. Crotty has co-authored several handbooks that have been published in BNA Tax & Accounting, Estate Planning, Steve Leimberg’s Estate Planning and Asset Protection Planning Newsletters, Estate Planning magazine, and Practical Tax Strategies.  Mr. Crotty is also the author of the Limited Liability Company Chapter of the Florida Bar’s Florida Small Business Practice, Seventh Edition. He, Alan Gassman and Christopher Denicolo are the co-authors of the BNA book Estate Tax Planning in 2011 & 2012.  Mr. Crotty is board certified by the Florida Bar Association in Tax Law. His email address is Ken@gassmanpa.com.

Thank you to our law clerks that assisted us in preparing this report.

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