ETHERIEDGE & ASSOCIATES, PC

48-year-old Man Adopts 42-year-old Girlfriend

JDE — Sat, 18 Feb 2012 04:41:54 +0000

48-year-old man adopts his 42-year-old girlfriend?! Sounds absurd, doesn’t it? Well, as far-fetched as it may seem, it happened recently. Read the full story from the Houston Chronicle. Multimillionaire John Goodman apparently adopted his girlfriend following an alleged drunk-driving accident that resulted in the death of a young pedestrian. Mr. Goodman established an irrevocable trust some years ago for his two minor children, a trust to which Mr. Goodman (and, most likely, his creditors, including the family of the young pedestrian killed in the accident) has no access. The recent adoption will likely enable Mr. Goodman’s girlfriend (and, presumably, Mr. Goodman, at least as long as he remain’s in his now-adopted daughter/girlfriend’s good graces) to access one-third of the trust’s assets, reportedly worth over $200 million.

Regardless of how you feel about Mr. Goodman’s creative answer to his problems, and even though you may not have a $200 million trust, it is important to recognize that we live in an ever-changing world. Things that were unheard of only a few years ago may become the clever trends of the future.

What would happen if one of your children someday adopted his adult girlfriend? Does your Estate Plan include provisions for dealing with such an unlikely event? It should.

Periodic review and update of your Estate Plan should be a priority. Among other things, it will help insure your intent and purposes prevail even in the face of “back door” techniques, like adult adoption.

If you have not reviewed your Estate Plan recently, Contact Us today to schedule an appointment.

IRS Releases List of “Dirty Dozen” Tax Scams for 2012

JDE — Sat, 18 Feb 2012 03:41:49 +0000

The IRS recently issued it’s annual list of top tax scams – the Dirty Dozen, reminding taxpayers to guard themselves against a variety of schemes, ranging from identity theft to tax preparer fraud. You can also view the Dirty Dozen Video.

Important Notice for Representatives of All Estates

JDE — Fri, 30 Sep 2011 21:46:21 +0000

Are you are an advisor or fiduciary (personal representative, executor, trustee) of an estate or trust of an individual dying in 2010 or later? If so, do not forget that an estate tax return (IRS Form 706) may still be required even if the value of the estate is less than $5 million.

The IRS issued Notice 2011-82 on September 29, 2011, advising that a Form 706 must be filed for a surviving spouse’s “portability election” (i.e., the election to take advantage of any unused portion of the deceased spouse’s exclusion amount) to be effective.

In light of this important Notice, make sure you file an estate tax return if the surviving spouse desires to make the portability election even if no return would otherwise be required.