Atlanta Estate Planning Lawyer Blog

As Primary Georgia Trust Litigation Lawyer in an Atlanta Trust Litigation Law Firm, beneficiaries named in a Georgia trust are entitled to understand the terms of the trust and what the trust will provide to them, both present and future. This can be critical to the lives of surviving minor children, spouses with no other source of income, or incapacitated individuals who must now rely on the trust to take care of their medical and living expenses. Trustees are in charge of managing and protecting trust assets in a transparent manner that upholds the trustee’s fiduciary responsibility to the beneficiaries.

One of the important fiduciary duties of Georgia trustees is to ensure that assets and property held by the trust are properly accounted for and reported to the beneficiaries. This is the foundation for trust in the trustee/beneficiary relationship. Some trust documents outline the procedures that beneficiaries must follow to request accounting information. In cases where the trust does not provide the procedure, Georgia law regulates when and how to request an accounting of trust assets. An experienced Georgia Trust litigation attorney can help beneficiaries better understand the accounting information they are entitled to and how to obtain it from the trustee.

Part of the duties of a trustee is to follow generally accepted accounting procedures (GAAP) for the recording of operating transactions. While it may be best to use an accountant to handle the accounting requirements, trustees can do this themselves. The trust’s assets and liabilities must be recorded. Assets can include real estate, stocks, bonds or any other property or asset that the trust owns. Liabilities are classified as debt and should be recorded at current values. Liabilities can include taxes owed, accounts payable or deferred tax liability. Expenses should also be recorded in a timely manner. Trust expenses can consist of the trustee’s salary, investment fees, office supplies, rent, and any applicable utilities. Moreover, an experience experienced Atlanta Trust Lawyer can help you determine if your Trustee is investing according to the Prudent Investor Rule and not putting your trust assets at risk.

Finally, the trust’s revenue must be tracked. Revenue can be generated when bank accounts held by the trust accrue interest income, stock and mutual fund portfolios earn gains, and property is sold. In the end, the timely and accurate recording of assets, liabilities, expenses, and revenue will allow the trustee to easily create documentation that shows beneficiaries the total value of the trust. Failure to provide this information to beneficiaries is a breach of fiduciary duty and can result in the removal of the trustee.

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As an Atlanta, Georgia Estate Attorney, I am always interested in helping my clients develop an optimal estate plan that will effectively manage their assets. Many of my clients come to my office already convinced that they need a Georgia living trust versus a will. People perceive the Georgia probate process to be lengthy and costly process, in both time and money. This perception is oftentimes based on the probate process in general. It is true that many states have a probate process that is exceedingly expensive and complicated ( Florida would be one state I would put in this category). However, the probate process in the State of Georgia would not fall into the category of expensive and complicated when you are being represented by an experienced Atlanta, Georgia probate lawyer.

The attraction of a Georgia living trust is that the assets named in the trust are not considered part of the decedent’s estate and therefore do not go through probate. To the contrary, assets that are subject to a testamentary devise, bequeath, or bequest under the decedent’s will, would be part of the decedent’s estate and would go through probate. But as I advise my clients, probate can be an efficient and useful process. Wills should be structured properly with the aim of mitigating conflict between the parties involved. Conflict and the resulting mediation or litigation is what inevitably causes the Georgia probate process to potentially become expense and time consuming. Nevertheless, oftentimes a form of dispute resolution or estate litigation in probate court is necessary. Sometimes a will is the right option when a living trust is too expensive for the benefit it provides or if conflict is inevitable between heirs. What is more, one of the greatest benefits of the probate process, is the Georgia probate court’s supervision over all parties involved in the decedent’s estate administration. In fact, the estate lawyers in our Atlanta, Georgia probate Law Firm, which specialize in Georgia estate administration and litigation, have found probate court oversight extremely beneficial when there are contentious heirs and/or aggressive creditors.

Different from a written document like a will, a living trust is a legal framework into which assets are transferred. Assets in a living trust can include cash, bank accounts, investment accounts, stock, land, homes, vehicles, collectibles and any other personal property. The terms of the living trust spell out to whom the assets will be distributed upon death and because the assets are no longer in your name, but in the name of the trust, they will not have to go through probate to be distributed. Besides posthumous probate avoidance, another important advantage of a living trust comes into play if the individual becomes unable to manage independently due to sickness or disability. In this case, a previously named successor trustee can take over and handle certain matters pertaining to the living trust.

The naming of trustees is obviously critical when setting up a living trust. Many people name themselves as the sole trustee and also name a series of successor trustees (in case one or more named trustees are not able to serve when needed). Either a person or an institution can be named as successor trustee. Spouses setting up a living trust frequently name themselves as co-trustees, although any two adults can be co-trustees. One of the benefits of naming co-trustees is that upon the death, resignation, or incapacity of one of the co-trustees, the surviving co-trustee can continue to administer the trust. Ultimately, the law gives trustees the right to complete control over assets in a living trust. For this reason it is critical that only the most trustworthy people are named as trustees. It is important to remember, all Georgia trustees must adhere to rigorous fiduciary duties imposed under Georgia law, whether they are an individual or entity. This is the same Georgia fiduciary duty imposed upon executors, administrators, and personal representatives.

Continue reading "WHAT TYPE OF GEORGIA ESTATE PLAN DO YOU NEED? EXPLORING WILLS AND LIVING TRUSTS" »

A Notice of Deficiency (“90-day letter”) is sent by the Internal Revenue Service (“IRS”) to officially allege that a taxpayer owes additional taxes. If you receive a Notice of Deficiency, you need to contact an Atlanta tax law firm immediately. When choosing which Atlanta tax law firm to contact, you should consider choosing an Atlanta based law firm with an experienced Atlanta tax attorney, IRS tax lawyer, and/or Atlanta tax law expert.

Once you receive the Notice of Deficiency, you have 90 days from the date of the Notice (not 90 days from the date you receive the Notice) to consult an Atlanta tax attorney and/or Atlanta tax expert to assist you in considering your options and addressing the serious nature and implied allegations of this IRS Notice. The reason I suggest that your seek out counsel from an Atlanta tax attorney and/or Atlanta tax expert, is that the United States Southeastern Headquarters for the Internal Revenue Service (“IRS”) is located in Atlanta as are the Federal Tax Court and the Federal Court for the Northern District of Georgia. This has several advantages in that resolving your IRS tax matter may involve a meeting with an Atlanta Based Internal Revenue Service Agent (“IRS Agent”) in the City of Atlanta. Additionally, should you need to resolve any Internal Revenue Service (“IRS”) dispute through the administrative tax law process in Tax Court or through litigation in Federal Court; you will likely be doing so in Atlanta, GA.

Regardless of whether you believe the Internal Revenue Service (“IRS”) is correct, the amount alleged in the Notice of Deficiency is due and owing. As such, I strongly recommended you consult an Atlanta tax attorney, Atlanta IRS tax lawyer, and/or Atlanta tax expert. In my many years of practicing in an Atlanta tax law firm as an Atlanta tax attorney, I have seen all too many people misread or not understand these IRS letters and cast them aside only to find out later that this alleged IRS Notice of Deficiency has dire consequences because IRS Tax Notice went disregarded.

As general rule, when the IRS involved and it is not in the common course of your dealings with them, you should err on the side of caution and understand what exactly it is you have received from them and what your options are. Moreover, many people throw these IRS Notices aside only to have this action come back to haunt them with extraordinarily expensive and dire consequences. You should have an Atlanta tax lawyer, Internal Revenue Service (“IRS”) tax lawyer and/or Atlanta tax expert advise you on exactly what the Notice you received is, and exactly what it means for you. It is altogether true; most people do not understand the nature of these letters and what exactly this particular “Notice” is telling you. Furthermore, assuming you are correct in your evaluation of the alleged Notice of Deficiency, you should consider having an Atlanta tax attorney and/or Atlanta tax expert negotiate an installment payment agreement or formulate “Offer in Compromise” on your behalf. This of course, is assuming you qualify for these forms of payment plans. Nevertheless, it is better to work with the Internal Revenue Service (“IRS”) at the earliest time you can and before it is too late. Once the IRS has spent time, monies, and resources tracking you down and seeking and forcing payment from you, they are much less likely to negotiate, if they will negotiate at all.

Continue reading "THE INTERNAL REVENUE SERVICE AND THE NOTICE OF DEFICIENCY OR THIRTY DAY LETTER (“30 DAY LETTER”) -- WHAT IS THIS IRS NOTICE OR LETTER? WHAT SHOULD YOU DO? WHO CAN HELP YOU? " »

There is now tax relief for Georgia homeowners and an upper hand advantage for the Georgia Tax Attorneys and Georgia Real Estate Attorneys who represent and assist them. In a news brief issued by the IRS for the benefit of those with troubled loans, the government now says that if your mortgage debt is partly or entirely forgiven during 2007, 2008 or 2009 you may be able to claim special tax relief by filling out Form 982 and attaching it to your federal income tax return for that year. Usually, forgiveness of debt results in taxable income. However, under the Mortgage Forgiveness Debt Relief Act of 2007, you may be able to exclude from tax up to $2 million of debt forgiven on your primary residence. The limit is $1 million for a married person filing a separate return.

Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, may qualify for this relief. The debt must have been used to buy, build, or substantially improve your principal residence and must have been secured by that residence. Debt used to refinance qualifying debt is also eligible for the exclusion, but only up to the amount of the old mortgage principal, just before the refinancing.

Debt forgiven on second homes, rental property, business property, credit cards, or car loans does not qualify for the new tax-relief provision. In some cases, however, other kinds of tax relief, based on insolvency, for example, may be available. The Adams Law Offices is conveniently located in the heart of Buckhead in Atlanta, Georgia, near the intersection of Piedmont and Roswell Roads. We would welcome the opportunity to be of assistance to you regarding any type of tax related matter concerning debt relief or other type loan restructuring or loan workout matters. Please call us at (404) 467-8611 or 1-877-412-3267, to discuss your options, or send us a message through our confidential Web Site form.

Foreign nationals may not fully understand the effect a green card has on his or her status for United States (“Federal”) tax purposes. The Federal Government taxes United States citizens and resident aliens on their worldwide income, regardless of their presence (or lack of presence) in the US. Nonresident aliens are only subject to Federal tax on their income connected to the United States.

For example, suppose you are a citizen of a foreign country and work full-time in a foreign country. While you may make no income in the United States and you only visit the United States a few weeks each year, the questions arises as to whether you owe Federal tax.

The answer may surprise you. It depends on whether you are deemed a resident alien or a nonresident alien. The test generally depends upon the number of days you are in the US. Most foreign nationals are aware of the “183 day” test, and keep careful track of their days of entry and leaving the US.

However, there is a second test. If you are a current green card holder, then you are deemed to be a resident alien. The number of days you are in the US does not determine your status for US tax purposes. Even if you have no presence in the US, you are still subject to Federal tax if you are a current green card holder.

This broad rule is justified by the US Congress because green card holders “have rights similar to those afforded US citizens (including the right to enter the US at will); equity demands that they contribute to the cost of running the government as much as citizens”.

Two exceptions likely mitigate Federal taxation. One is that a resident alien can claim a tax credit against his or her Federal tax for taxes paid in a foreign country. The other exception is that a tax treaty between the US and a resident alien’s home country may exempt US taxation of a resident’s income earned outside the US.

Federal taxation of foreign nationals is a complex subject. You should seek the legal representation of a tax lawyer and a tax expert. The Adams Law Offices offers representation from tax attorneys and tax experts who not only have worked in the private sector but have also worked with The United States Tax Court. We are ready to serve and assist you with your tax related matters and our Main Office is conveniently located in the heart of Buckhead. Please call us at 1-877-412-3267 or (404) 467-8611, to discuss your options, or send us a message through our confidential Web Site form.

Lifetime gifts in contemplation of death, or so-called “deathbed gifts” are usually made by a surviving parent to a child. The parent and/or the child think the gift is a good idea, probably to facilitate a transfer of legal title and/or to avoid probate. Sometimes a deathbed transfer might be made because the parent does not have a will, and thinks the lifetime gift is a good way to take the place of a will.

First, probate is not that much trouble, at least in Georgia. Also, a deathbed will is just as easy to prepare as a deed, for example. But the real problem for the beneficiary relates to the tax basis of the property.

For lifetime gifts, the grantor’s tax basis (generally the original cost of the property) becomes the tax basis of the grantee/beneficiary. For property received by a beneficiary thru the probate process (a so-called “testamentary gift”), the beneficiary’s tax basis is the fair market value of the property at the time of the decedent’s death.

For example: Assume a parent purchased a lake home years ago for $25,000. Now the lake property is worth $175,000. The parent makes a lifetime gift of the lake home to a child. The child’s tax basis is $25,000 (the original cost of the property). Upon a sale of the property for $175,000, the child’s tax gain is $150,000.

Instead assume the child received the lake home after the parent’s death thru the deceased parent’s will. The child then sells the property for $175,000. The child’s tax gain is zero, because the child’s tax basis is $175,000 (the fair market value at the time of the parent’s death). Assuming the above example, the difference between a lifetime gift and a testamentary gift could be a tax difference of as much as $60,000! So beware. A lifetime gift can result in a lot of needless tax.

Oftentimes, there are many factors involved making the best decisions about making lifetime gifts or setting up an estate plan which minimizes or diminishes any unwanted or unforeseen tax consequences. Needless to say, it is well worth the savings and peace of mind to find out before it’s too late.

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Our Atlanta, Georgia estate law firm uses multiple vehicles when creating and an estate plan. One common estate planning tool involves joint ownership of an asset. Joint ownership of property means legal title is in two or more names. Generally this means upon the death of one legal owner, the property passes by operation of law to the other legal owner. Sometimes this type of ownership makes a lot of sense. For example, a husband and wife own their home in joint names. Upon the death of the first spouse, the home passes by operation of law to the surviving spouse.

There is no probate for most jointly owned property. There is no court involvement in the surviving joint owner assuming full legal title to the jointly owned property. Again, many times this is exactly what the decedent wants and the survivor has no probate concerns.

The lack of probate and the ease of property transfer are among the reasons a mother or father frequently add a child’s name to the mother’s or father’s bank account. But remember upon death the bank account, certificate of deposit or whatever property is held in joint names with a child transfers by operation of law to that child alone.

I’ve seen many surviving spouses name their children as equal beneficiaries in their will, but then put most if not all of their assets in joint names with just one child. Guess what happens on death? Despite the will directing that all the children share equally in the assets, there are no assets in the probate estate upon which the will operates to pass legal title. Instead, all the assets pass by operation of law solely to the child who is named as a joint owner.

Joint ownership can be a trap if you’re not careful and that is why the engagement of an estate planning attorney is essential to eliminate the many traps that you can fall into. In Atlanta, GA The Adams Law Offices crafts each estate plan with the individual in mind setting our goals for the minimum amount of probate and expense with the maximum amount of client satisfaction.

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