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Against A Uniform Law On The Income Taxation Of Trusts, Michelle S. Simon
Against A Uniform Law On The Income Taxation Of Trusts, Michelle S. Simon
Elisabeth Haub School of Law Faculty Publications
In many areas, uniformity of state law is both practical and desirable. The Uniform Commercial Code, for example, brought harmony to conflicting state laws regarding the sale of goods and secured transactions, smoothing the way for interstate commerce. The law of trusts and estates is another area to which the Uniform Law Commissioners have recently turned their attention. Given the multitude of conflicts in state law regarding intestacy, fiduciary powers, and remote notarization, greater consistency between the states would be welcome. One area that should be off-limits to uniform lawmaking is the state income taxation of trusts. Despite complex and …
What Probate Courts Cite: Lessons From The New York County Surrogate’S Court 2017-2018, Bridget J. Crawford
What Probate Courts Cite: Lessons From The New York County Surrogate’S Court 2017-2018, Bridget J. Crawford
Elisabeth Haub School of Law Faculty Publications
By knowing what a judge cites, one may better understand what the judge believes is important, how the judge understands her work will be used, and how the judge conceives of the judicial role. Empirical scholars have devoted serious attention to the citation practices and patterns of the Supreme Court of the United States, the United States Courts of Appeals, and multiple state supreme courts. Remarkably little is known about what probate courts cite. This Article makes three principal claims — one empirical, one interpretative, and one normative. This Article demonstrates through data, derived from a study of all decrees …
The Supreme Court, Due Process And State Income Taxation Of Trusts, Bridget J. Crawford, Michelle S. Simon
The Supreme Court, Due Process And State Income Taxation Of Trusts, Bridget J. Crawford, Michelle S. Simon
Elisabeth Haub School of Law Faculty Publications
What are the constitutional limits on a state's power to tax a trust with no connection to the state, other than the accident that a potential beneficiary lives there? The Supreme Court of the United States will take up this question this term in the context of North Carolina Department of Revenue v. Kimberley Rice Kaestner 1992 Family Trust. The case involves North Carolina's income taxation of a trust with a contingent beneficiary, meaning someone who is eligible, but not certain, to receive a distribution or benefit from the trust, who resides in that state. Part I of this Article …
Magical Thinking And Trusts, Bridget J. Crawford
Magical Thinking And Trusts, Bridget J. Crawford
Elisabeth Haub School of Law Faculty Publications
At a time of monumental economic inequality in the United States, wealthy individuals and their tax-motivated behavior have come under significant scrutiny from all corners. In 2019, the Supreme Court issued its first major ruling in over sixty years on the state income taxation of trusts. In North Carolina Department of Revenue v. Kimberley Rice Kaestner 1992 Family Trust, the Court declined to close what some critics consider to be a major loophole that benefits the trusts that wealthy individuals create for family members. This Article makes two principal claims—one interpretative and the other normative. This Article explains why the …
Less Trust Means More Trusts, Bridget J. Crawford
Less Trust Means More Trusts, Bridget J. Crawford
Elisabeth Haub School of Law Faculty Publications
The word “trust” has multiple meanings. In everyday speech, it refers to a feeling of confidence associated with integrity, such as trusting that a friend will keep a secret. In the financial context, some law students, lawyers and lucky individuals also understand that a trust is a near-magical device that splits legal and equitable title. A trustee holds formal legal title to property for the benefit of a beneficiary simply because the grantor declares it to be so. By turning the spotlight on “trust,” in both senses of the word, one can discern fault lines in contemporary U.S. political and …
Change Is Constant In Estate Planning: Reflections Of An Actec Law Journal Editor, Bridget J. Crawford
Change Is Constant In Estate Planning: Reflections Of An Actec Law Journal Editor, Bridget J. Crawford
Elisabeth Haub School of Law Faculty Publications
Change is the only constant in the life of a trusts and estates professional. The law changes; the needs of clients change; the methods for achieving certain results change; technology and modes of communication change. So, too, it can be said that change is the only constant running through more than forty years of our organization's flagship publication.
A Critical Research Agenda For Wills, Trusts And Estates, Bridget J. Crawford
A Critical Research Agenda For Wills, Trusts And Estates, Bridget J. Crawford
Elisabeth Haub School of Law Faculty Publications
The law of wills, trusts, and estates could benefit from consideration of its development and impact on people of color; women of all colors; lesbian, gay, bisexual, and transgender individuals; low-income and poor individuals; the disabled; and nontraditional families. One can measure the law's commitment to justice and equality by understanding the impact on these historically disempowered groups of the laws of intestacy, spousal rights, child protection, will formalities, will contests, and will construction; the creation, operation and construction of trusts; fiduciary administration; creditors' rights; asset protection; nonprobate transfers; planning for incapacity and death; and wealth transfer taxation. This Article …
Who Is Afraid Of Perpetual Trusts?, Bridget J. Crawford
Who Is Afraid Of Perpetual Trusts?, Bridget J. Crawford
Elisabeth Haub School of Law Faculty Publications
Professor Lawrence Waggoner nominally aims his critique at wealthy individuals who desire perpetual trusts and the lawmakers who enable them by passing favorable legislation. He lodges five specific objections: (1) after a certain period of time, the beneficiaries of perpetual trusts will be insufficiently related to the trust creator; (2) after a certain period of time, there will be too many beneficiaries of a perpetual trust; (3) perpetual trusts will be expensive to manage; (4) outdated trust instruments will hamper management of perpetual trusts; and (5) trustee turnover will negatively impact perpetual trusts. This Essay considers each of his objections …
Grantor Trusts And Income Tax Reporting Requirements: A Primer, Bridget J. Crawford
Grantor Trusts And Income Tax Reporting Requirements: A Primer, Bridget J. Crawford
Elisabeth Haub School of Law Faculty Publications
In the last decade, grantor trusts have become a cornerstone of many sophisticated estate plans. Although clients and their advisors employ grantor trusts with great frequency and success, few taxpayers and not all estate planning professionals are fully conversant with the income tax reporting requirements for grantor trusts. Some erroneously assume that because grantor trusts are "ignored" for purposes of calculating taxable income, they are also ignored for purposes of reporting taxable income. this is not always the case, however. This article explains the complex rules with which taxpayers and their advisors must comply for reporting income of grantor trusts. …
Wilderness No More: Alaska As The New "Offshore" Trust Jurisdiction, Bridget J. Crawford
Wilderness No More: Alaska As The New "Offshore" Trust Jurisdiction, Bridget J. Crawford
Elisabeth Haub School of Law Faculty Publications
Alaska has made two sweeping reforms to its trust laws in an effort to position itself as the most sophisticated "offshore" trust jurisdiction for wealthy U.S. citizens and non-U.S. persons holding substantial U.S. property or stock. This article describes Alaska's departure from the venerated (if misinterpreted) rule against perpetuities and illustrates how the new Alaska law effectively allows taxpayers to make their own decision about the level at which a trust will be taxed. This article also details Alaska's approach to self-settled spendthrift trusts. In certain circumstances, an existing or future creditor will be prevented from satisfying a claim out …
Prudence, Information, And Trust Investment Law, John A. Humbach
Prudence, Information, And Trust Investment Law, John A. Humbach
Elisabeth Haub School of Law Faculty Publications
Professors Langbein and Posner recently proposed that fiduciaries be allowed to invest in market funds under a relaxation of the prudent investor standard. But a relaxation of the selectivity requirements may be destructive of capital market efficiency and perhaps of the capital markets themselves.
Surviving Spouse's Distributive Share Of Amendable Trusts, John A. Humbach
Surviving Spouse's Distributive Share Of Amendable Trusts, John A. Humbach
Elisabeth Haub School of Law Faculty Publications
Purcell v. Cleveland Trust Co., 200 N.E.2d 602, 28 Ohio Op. 2d 262 (P. Ct. 1964). Approximately three years before her death in 1960, plaintiff's wife created an amendable and revocable inter vivos trust, naming defendant as trustee. The formally drawn instrument provided for pour-over from her simultaneously executed will, however, a specific bequest to the trust was apparently never made. After his wife's death, plaintiff, choosing to exercise his statutory prerogative of taking against his wife's will: demanded that defendant trustee pay over to h i from the corpus of the inter vivos trust the one-half share which he …