ElderLaw Answers Blog

My friend, Jeff Frieden, a Professor of Government at Harvard University and author of Global Capitalism, explains that this is not the first time the world has seen a global economic crisis like the one we are experiencing today.  In four short videos on the website BigThink, he explains the historical context of our current melt down and offers a prescription for solving the crisis so that it does not lead to a long-term economic freeze for the world.  The solution must work financially, morally and politically.  It will only work if the benefits of globalization benefit everyone, not just the elite.  Check it out here.

Gov. Sarah Palin is quoted on CBS News’ Scott Conroy’s blog as charging that Sen. Barack Obama’s tax plan will harm beneficiaries of special needs trusts because it raises the tax on trusts.  The campaign truth alarms should be buzzing now.

Yes, Sen. Obama’s tax plan would raise the marginal rate on trusts earning and paying taxes on more than $8,000 of dividend and interest income a year.  But this will affect few if any special needs trusts.

This is because trusts are only taxed on retained income.  Income used for a beneficiary with special needs is taxed to the beneficiary.  Most pay little or no personal income taxes due to their low income.  And the Obama tax plan does not affect lower-income taxpayers.

A trust will only pay higher taxes under the Obama plan if its income in any year exceeds its distributions and expenses.  This almost never happens with special needs trusts due to their size and the needs of their beneficiaries.

This focus on this small aspect of the Obama tax proposal also confuses the trees for the forest.  The bigger picture is that individuals with special needs are losing benefits and vital programs throughout the nation because the states are having to cut their budgets due to the current financial climate and lack of adequate support from Washington.  Tax revenue is needed to fund these programs.

We can’t know whether Gov. Palin and her handlers are purposely misconstruing this issue or simply have not adequately investigated it before her speech.  But the second explanation — the shoot first and ask questions later approach — is as irresponsible as the first.

Earlier today, I interviewed Richard C. Milstein on a conference call for members of ElderLawAnswers and the Academy of Special Needs Planners.  Richard was the court-appointed guardian ad litem for Anna Nicole Smith’s daughter, Dannielynn. 

Under Florida law, since Anna Nicole did not have an advance funeral directive, her only surviving child had the power to determine where she would be buried and what her funeral would look like.  Since Dannielynn was a baby, Richard was appointed to represent her and ultimately to make the decision on her behalf.  That decision came after nine days of practically non-stop testimony and legal procedures in the Fort Lauderdale courthouse.

Ultimately, Richard determined that Anna Nicole should be buried in the Bahamas where her son had recently been interred and where she had a burial plot with him.  Richard made this determination and orchestrated the funeral on behalf of Dannielynn, all while doing his best to avoid the media circus engulfing the case.

Richard’s advice after experiencing this case is for everyone to determine his or her state’s laws on making advance funeral plans and take whatever steps necessary to avoid any disputes after you are gone.  This is especially true for anyone who is unmarried and does not have a single person — the surviving spouse — with the legal authority to make these decisions.

I’m writing from St. Petersburg, Florida, where I’m attending Stetson College of Law’s 10^th annual conference on Special Needs Trusts. I ran into my old friend and colleague, Ron Landsman, who had an interesting observation. CNN Headline News every morning shows a map of the United States showing all of the airplanes in the air, in excess of 3,000 every morning. These planes are full (especially these days) of people traveling for all sorts of reasons, but many going to meetings such as ours.

With our nation approaching 300 million residents, there is an association or group for just about everyone. At our meeting, there are approximately 300 attorneys and other professionals from all over the country spending two days learning and exchanging experiences about estate planning for individuals with special needs. These practitioners have an interest and a need for their clients to have an especially in depth knowledge of this field, more than the other 300 million Americans.

The meeting could have easily have been of people interested in playing pool, building pools, or throwing darts. Almost anyone can find their community of like-minded or like-interested people who share their professional specialty, hobby or special skill. Many of the communities today are on line. But there’s no substitute for meeting in person. That should keep the convention business and airlines in business despite the current economic downturn.

While our site’s poll is non-scientific, it doesn’t seem too far off from the rest of the country.  In October, visitors to www.elderlawanswers.com favored John McCain over Barack Obama by a slim margin, 49 to 48 percent.

We thought we’d see how the debate would affect support for Joseph Biden and Sarah Palin by running a poll both just before and right after they faced off.  Prior to the poll, our users rated Biden ahead 56 to 41 percent with 3 percent undecided.

After the debate, Biden increased his lead with almost two thirds of ElderLawAnswers users favoring him, 66 to 34 percent.  This post-debate bump has faded a bit with 61 percent supporting Biden today as opposed to 37 percent for Palin and 2 percent undecided.  We’ll have to see if this change in support of the supporting actors carries over their principals, McCain and Obama.

My law school friend and current Boston College Law School professor, Ray Madoff, recently wrote an op-ed article in The New York Times on the topic of Leona Helmsely’s $8 billion bequest to a foundation for dogs. Professor Madoff’s thesis is that $3.6 billion of this bequest come out of our pockets as taxes, since the charitable deduction avoides the 45% federal estate tax. Further, Madoff explains, given that the foundation is only required to spend 5% of its assets a year, including the administration costs, the foundation may last forever to the greater benefit of the foundation officers than the dogs it is supposed to assist. Madoff calls for a limit on the federal charitable deduction so that the taxpayer no longer subsidizes the whims of rich benefactors. Read more here: http://www.nytimes.com/2008/07/09/opinion/09madoff.html?_r=1&adxnnl=1&oref=slogin&emc=eta1&adxnnlx=1218250814-Q9Zfu0ZYLSMYz2t4tbgPQg

The  Family Caregiver Alliance has published to guides to resources on family caregiving, one for consumers and one for professionals.  Both can be downloaded at http://caregiver.org/caregiver/jsp/content_node.jsp?nodeid=2224&expandnodeid=1648.  While neither is entirely complete, and both refer back to the Family Caregiver Alliance web site quite a bit, both are excellent places to start any search for resources.